USDA Funds $650,000 Study to Analyze U.S. Business Decarbonization

The United States is moving steadily towards decarbonization, and rural communities may stand at the heart of that transition.

A team of researchers led by Stephan Goetz and Zheng Tian from Penn State University aims to investigate how U.S. businesses are embracing renewable energy and the effects on rural development.

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Funded by a $650,000 grant from the U.S. Department of Agriculture’s National Institute of Food and Agriculture, the study will delve into why, how, and where businesses are switching to renewable energy sources.Goetz, a professor of agricultural and regional economics, emphasized that "the industrial transition from fossil fuels to renewable energy is occurring one firm at a time."

His project, collaborating with institutions like the USDA Economic Research Service and the Oak Ridge Institute for Science and Education, is the first to use newly available federal data to analyze firm-level decarbonization decisions.

This research is critical because businesses make their energy choices individually. At the firm level, managers and owners are the decision-makers determining whether the shift to green energy is successful.

"Our goal is to develop a research-based understanding of the adoption decisions businesses are making and the barriers they face," Goetz explained. "This will inform the ongoing transition to a low-carbon economy."

Shaping the Future of Rural Communities

The study not only focuses on business adoption but also takes a deep dive into rural development. Zheng Tian, a co-principal investigator and assistant research professor at Penn State, shared that their research will also investigate the rural development implications of the shift to a low-carbon economy.

According to Tian, rural communities are in a unique position: "On one hand, rural areas have the open space available to support renewable energy projects, and they stand to benefit in multiple ways from this transition."

However, these regions are also beginning to see land-use conflicts arising from initiatives like agrivoltaics, which seek to combine solar panels with farming.

"We're seeing growing resistance to these energy projects in many rural areas," Tian noted, emphasizing how renewable energy projects on private land can still spark community opposition, particularly over concerns about visual impact and economic benefits.

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The Role of Agrivoltaics

Agrivoltaics presents both an opportunity and a challenge in the race towards decarbonization. This practice aims to optimize land use by allowing both food and energy production on the same land.

Yet, as promising as it sounds, it has stirred up resistance among local communities. These land-use conflicts often arise from concerns over the visual impact of solar panels spread across farmlands.

Additionally, communities may worry about how the financial rewards from these projects are distributed, which can add to the tension.

Tian pointed out that these conflicts can have far-reaching consequences on the adoption of renewable energy in rural areas.

Unveiling Business and Community Characteristics

A key aspect of this project is identifying the characteristics of businesses that embrace renewable energy and the community factors that either support or obstruct its adoption.

By examining differences between urban and rural firms, researchers hope to better understand the unique challenges and opportunities faced by businesses in different settings.

The research will shed light on how U.S. businesses and communities navigate the challenges posed by green infrastructure, with findings being developed into educational materials for various stakeholders, including local governments, federal agencies, entrepreneurs, and other community members.

The research team, alongside Goetz and Tian, includes Timothy Wojan, a fellow at the Oak Ridge Institute for Science and Education at the National Center for Science and Engineering Statistics, Justin Winikoff, a research agricultural economist with the USDA Economic Research Service, and Luyi Han, a postdoctoral scholar at the Northeast Regional Center for Rural Development (NERCRD).

Fostering Better Understanding of Renewable Energy Adoption

The research team’s findings could play a crucial role in shaping the future of renewable energy adoption across the U.S. "Our study will develop a research-based understanding of how businesses make decisions regarding renewable energy and the barriers they face," said Goetz.

By identifying these hurdles, the research will be able to support businesses as they navigate the process of decarbonization.

By analyzing the distinct characteristics of both businesses and their communities, the team will help form a comprehensive picture of how rural and urban firms approach the shift to renewable energy.

These findings could help develop targeted strategies that promote renewable energy adoption while addressing the unique needs of different regions.

Educational materials and insights from this project are intended to provide a solid foundation for policymakers, business leaders, and community organizers to facilitate the decarbonization process in rural America.

A New Era for Green Energy

As decarbonization continues to gain momentum, businesses, rural communities, and urban firms alike will need to work together to overcome challenges.

By providing a clearer understanding of why and how businesses adopt renewable energy, the research led by Goetz and his team will be an important step forward in supporting the transition to a low-carbon economy.

This new era of green energy, driven by individual firms making thoughtful decisions, is poised to reshape rural and urban landscapes, offering new opportunities for sustainable growth.

"The insights we gather from this study will help guide businesses and communities through the complexities of renewable energy adoption," concluded Goetz.

For more information on Penn State's research efforts, visit https://www.psu.edu/. You can also learn more about the USDA's support for renewable energy initiatives at https://www.usda.gov/.