Investments in solar photovoltaic energy generate significant economic and social benefits in the municipalities where they are implemented. This is the conclusion of the study “Socioeconomic Impact of Investments in Solar Photovoltaic Energy,” conducted by research teams from the Carlos III University of Madrid and the Complutense University.

The analysis, which combines quantitative statistical techniques with qualitative fieldwork, reveals that the implementation of solar plants contributes to boosting local employment, attracting residents, stimulating the business community, and increasing municipal revenues. This is largely positively perceived by society and linked to the modernization and diversification of the local economy.

“The main findings show significant benefits for local employment, economic activity, and municipal finances, as well as positive effects on residents’ demographics and per capita income. These data demonstrate that photovoltaics is not only essential for mitigating climate change, but is also a key element in promoting territorial cohesion and local development ,” commented Natalia Fabra, economist and professor of economics at Carlos III University and director of the quantitative study.

“Photovoltaic projects in rural areas have great development potential for the rural world. The results of the fieldwork show that, in general terms, the attitude of local stakeholders toward photovoltaics is positive, especially due to the direct and indirect economic benefits it generates and when its development prioritizes transparency, participation, and commitment to territorial development, so that these benefits and opportunities they undoubtedly bring have a tangible and direct impact on the inhabitants of the municipalities where they are developed ,” notes Juan Andrés Walliser, PhD in Sociology from the Complutense University of Madrid , and co-director of the qualitative analysis and documentation of the case studies, along with Pedro Uceda Navas, assistant professor at the Complutense University of Madrid.

The study highlights that, to maximize the opportunities these investments offer for municipalities, public policies must focus on worker training, strengthening the industrial fabric, and the effective use of tax revenues. Therefore, if good governance, sustainability, and participation practices are maintained and strengthened, photovoltaic plants can become a driver of development for municipalities with a wide range of characteristics.

Main quantitative impacts

Demographics: Municipalities with photovoltaic installations experience population growth of between 3% and 7%, helping to combat rural depopulation.

Economic Activity: A 2% increase in the number of registered businesses in the municipalities was observed, especially in construction, hospitality, and agriculture. Housing prices also rose by an average of 3%, reflecting increased demand driven by population growth.

Employment: Solar plants create jobs, especially during the construction phase, reducing unemployment in sectors such as industry and services. The study estimates that the construction of solar photovoltaic parks results in an average increase of between 7% and 13% in employment in municipalities, a relatively greater effect in smaller municipalities.

Per capita income and public finances: Municipal tax revenues grew by around 11%, providing greater scope for investment in public services. Furthermore, an increase of between 0.5% and 1% was recorded in the average direct income of residents.

Social perceptions and challenges

From a qualitative perspective, the results of the fieldwork show that social perception is generally positive and associated with the modernization and diversification of the local economy. Particularly noteworthy is the positive assessment of projects where local citizen participation during project development and agreement on the development of their contribution to the municipality have been significant.

The study reveals that negotiation processes are characterized by the search for agreements and collaboration between companies, local governments, landowners, and social groups, aimed at maximizing benefits for the region and socially legitimizing projects, prioritizing dialogue and the creation of collaboration agreements that include commitments to employment, investment, and social and environmental improvements.

In municipalities with a longer-standing energy tradition, it is perceived as a natural evolution of productive activity, and it is generally seen that social appreciation increases with the passage of time and maturity.

Regarding environmental impact, the study highlights the perceived low impact compared to other energy sources, with particular emphasis on environmental integration and compensation measures.

However, challenges and new opportunities for greater positive impact and consensus-building in the territories are also identified.

Mainly, the need is identified for greater visibility regarding the impact on local biodiversity, improvements in agreements to minimize the impact on the landscape, greater coordination between administrations, and clearer regulations that facilitate decision-making, establishing participatory processes and fostering transparent dialogue that allows investments to respond to the specific and concrete needs of municipalities and their inhabitants.

An effective guide to maximizing the local benefits of photovoltaics in the territories

With the aim of maximizing the positive impact of photovoltaic parks in the territories where they are located, the Spanish Photovoltaic Union (UNEF) has developed a guide to good practices and a Seal of Excellence in Sustainability that promotes the highest standards of social and environmental integration and lays the groundwork for best practices in the circular economy.

The UNEF Seal of Excellence, developed with the support of independent experts and leading environmental associations such as WWF and SEO Birdlife, already has 4,575 MW certified and 968 MW in the pipeline. It is periodically reviewed to incorporate recommendations from the various stakeholders involved in project development and implementation.

Furthermore, UNEF, in collaboration with the independent consultancy firm EMAT, prepares each year the “Study of the Impact of Photovoltaics on Biodiversity.”

This study assesses and analyzes the biodiversity present in different photovoltaic solar installations. In its latest edition, presented to the Congress of Deputies last January, it indicates that a good choice of location and proper maintenance can establish an even greater biodiversity of fauna than previously existed, and that the implementation of environmental protection and improvement measures is yielding positive results in the presence of species such as the European roller, the common kestrel, and steppe species such as the sandgrouse and the little bustard.

“Our goal is for solar farms to be a constant presence throughout their useful life, contributing to the development and prosperity of the municipality. And for the area where they are located to remain, after their arrival, not only the same, but better than before ,” commented José Donoso, director general of UNEF.