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DIW Discussion Papers 2175 / 2026
The 2022 energy crisis led to sharp energy price surges and prompted public appeals and government programs to reduce energy consumption. This paper isolates energy savings driven by retail price increases from non-price driven savings attributable to other crisisrelated factors such as public appeals. Using German residential energy billing data and a DiD-PSM approach, we identify average price-driven ...
2026| Sophie M. Behr, Till Köveker, Merve Kücük
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DIW Discussion Papers 2167 / 2026
Empirical evidence on price premiums for green intermediate products is scarce, especially for energy-intensive basic materials. Evidence on such green premiums is relevant, as they may affect companies incentives to invest in green production technologies. Moreover, green premiums are important for the design of green support programmes, as support levels could be adjusted for companies’ green revenues. ...
2026| Till Köveker, Philipp Cremer
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DIW Discussion Papers 2156 / 2026
Locational marginal pricing (LMP) provides efficient locational dispatch and investment signals but requires a complementary congestion hedging instrument to function effectively. This paper investigates how exposure to locational price differences is managed in North American nodal electricity markets through the implementation of financial transmission rights (FTRs). Drawing on insights from 15 industry ...
2026| Leon Stolle, Jonas Boeschemeier, Benjamin F. Hobbs, Karsten Neuhoff
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DIW Discussion Papers 2153 / 2026
The Net Zero Industry Act (NZIA) promotes non-price criteria in renewable auctions. It aims to unlock green willingness-to-pay and scale up manufacturing capacity for net-zero technologies in the European Union (EU). This paper builds a partial equilibrium model of the European solar module sector and investigates how renewable auction design impacts solar photo- voltaic (PV) manufacturing. First, ...
2026| Thibault Deletombe
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DIW Discussion Papers 2133 / 2025
Carbon pricing policies are usually combined with compensation for exposed firms to prevent adverse competitiveness effects. In cap-and-trade systems, this carbon cost compensation mostly occurs through free allocation of emission permits. Using an administrative panel of German manufacturing firms, this paper investigates how free allocation in the European Union Emissions Trading System affects firms’ ...
2025| Till Köveker, Robin Sogalla
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DIW Discussion Papers 2127 / 2025
To ensure security of supply in the power sector, many countries are already using or discussing the introduction of capacity mechanisms. Two main types of such mechanisms include capacity markets and capacity reserves. Simultaneously, the expansion of variable renewable energy sources increases the need for power sector flexibility, for which there are promising yet often under-utilized options on ...
2025| Franziska Klaucke, Karsten Neuhoff, Alexander Roth, Wolf-Peter Schill, Leon Stolle
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DIW Discussion Papers 2126 / 2025
This paper revisits the exporter’s environmental premium (EEP) by incorporating emissions embodied in domestically and internationally sourced intermediate inputs. Combining administrative firm-level data and customs records for German manufacturers with an environmentally extended input-output table and fuel specific emission factors, we document three stylized facts: (i) embodied emissions account ...
2025| Till Köveker, Philipp M. Richter, Alexander Schiersch, Robin Sogalla
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DIW Discussion Papers 2121 / 2025
This study examines how policies affecting the cost of using fossil fuels in production influence comparative advantage in the industrial sector. Firstly, we use a fixed-effects gravity model to estimate the export capabilities that determine comparative advantage. Subsequently, using data on direct (carbon taxes, ETS permit prices) and indirect (fossil fuel excise taxes and subsidies) carbon pricing ...
2025| Antonia Kurz, Stela Rubínová
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DIW Discussion Papers 2119 / 2025
The energy crisis following Russia’s invasion of Ukraine exposed the heightened vulnerability of low-income households to rising heating costs, particularly those in energy inefficient buildings. Using data from the German Socio-Economic Panel (SOEP), this study examines the distributional impact of heating costs across income deciles and evaluates the effectiveness of policy interventions. We find ...
2025| Sophie M. Behr, Merve Kucuk, Maximilian Longmuir, Karsten Neuhoff
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DIW Discussion Papers 2118 / 2025
We examine the impact of the war in Ukraine on long-term contracts in energy markets. We find that traded contract volumes fall by 65 percent in the first months of the war. A collapse in bilateral trading contributes most to this decline. To protect themselves from price shocks, firms increasingly turned to long-term contracts already before the war. In sum, our results show that the market continued ...
2025| Mats Kröger, Karsten Neuhoff, Sebastian Schwenen