The Inflation Reduction Act (IRA) is the largest climate policy intervention in modern U.S. history, allocating hundreds of billions of dollars to investment incentives. I examine the causal effects of the IRA on local labor markets exploiting variation in statutory industry-level IRA exposure interacted with pre-existing county industry composition in a difference-in-differences design. A one-standard-deviation increase in county IRA exposure increases employment growth by 0.5% and firm growth by 0.12%, with no effect on wages. Using microdata on federal grant awards, I show that counties receiving larger IRA-related grants experience higher employment and wage growth. I then evaluate place-based targeting through energy-community designation and find no average post-IRA effects on employment or firm growth. However, energy communities receiving more direct grants exhibit modest employment and wage gains. These results inform broader debates about the role of different instruments that the government can use in stimulating local economic activity.

How can the green transition reduce residential energy consumption while addressing equity concerns? This paper examines how energy-related subsidies within Germany’s basic security system affect household energy consumption, expenditures, and services. We develop a theoretical framework to study the incentives of lump-sum transfers and full cost-coverage subsidies, accounting for energy efficiency and prices. We empirically test its implications using data from the German Socio-Economic Panel and the Energy Saving Check. We exploit two transfer reforms and the energy price crisis with (triple) DiD strategies. We find that subsidy recipients exhibit higher energy consumption and expenditures than comparable households, yet do not enjoy better energy services, measured by indicators such as adequate warmth. Mechanism analysis shows that these households face higher electricity prices and lower energy efficiency. These findings suggest that improving energy efficiency is key to achieving climate objectives while alleviating energy poverty through enhanced energy services without raising consumption.

Households investing in solar panels become prosumers. Their tendency to increase electricity consumption after installation is a “rebound effect” but little is known about the drivers of this change. Do solar households buy new power-hungry appliances or do they substitute other energy sources for electricity. We give a preliminary answer by studying the natural gas–electricity substitution. Should the latter case hold true, we should observe a decrease of the natural gas consumption. To test this hypothesis, we employ the consumption data provided by the major distribution system operator for the Liège of Belgium. We select the over 12,000 clients who have installed solar PV and are connected to the natural gas network. We propose different panel data estimation strategies of the solar rebound and we identify a negative impact of being prosumer on the natural gas consumption, which decrease by 3.5% after the installations of the panels.

Aggregate price shocks can lead to significant inequality in losses both across and within income groups, creating a trade-off between supporting households through subsidies versus targeted transfers. This study examines the redistributional consequences and behavioral responses to Sweden’s 2021-2022 electricity crisis, when prices in southern zones reached four times those in northern zones due to the country’s bidding zone system. Using rich administrative microdata covering 2017-2022, I find that: (1) Residential mobility declined in high-price zones, (2) Households reduced energy consumption by 3-22% relative to baseline, with larger reductions in less efficient building stock, (3) Geothermal heat pump installations increased.