Exploring energy markets and their impact on the economy

The Center for Energy and the Economy (CEE) produces academic research that expands and deepens our collective understanding of how developments in energy markets inform monetary policy. The Center, established in August 2025, serves as a platform to facilitate the dissemination of energy sector expertise throughout the Federal Reserve System and to the public.

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Research

Smooth Operator? Managing Electric Vehicle Integration in Constrained Distribution Networks

This paper examines the underappreciated challenges that electric vehicle (EV) adoption poses for the distribution grid.

Pollution Taxes and Clean Subsidies in an Open Economy

This paper shows that the same conditions that lead to pollution leakage enhance the efficacy of clean subsidies.

Time-Limited Subsidies: Optimal Taxation with Implications for Renewable Energy Subsidies

Pigouvian subsidies are efficient, but output subsidies with uncertain or limited durations are not Pigouvian. This paper shows that optimal “time-limited” policies must also subsidize investment to correct externalities generated after the output subsidy ends.

The Effects of Competition in the Retail Gasoline Industry

This paper estimates the effect of competition on incumbent firm pricing by using high frequency price data and the precise geographic location for all gas stations in California.

What Fuels the Volatility of Electricity Prices?

This paper uses emergency outages of coal generators as an exogenous source of variation in the power generation stack to study how changes in marginal fuel affect real-time prices. Contrary to anecdotal evidence, the authors find that wholesale prices are less volatile when natural gas is on the margin more often.

Do Bill Shocks Induce Energy Efficiency Investments?

This paper studies whether electricity bill shocks draw attention to the benefits of home energy efficiency investments.

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Insights

Dallas Fed Economics

Utility-scale solar shines in Texas despite tariffs, federal policy changes

Texas is now the top state for utility-scale solar power generation capacity. However, developers of new solar projects face a changing operating environment, one lacking strong federal policy support but also featuring cost-boosting tariffs on imported solar module components.

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Southwest Economy

Overflowing U.S. shale gas increasingly streams to Mexico and onto global markets

Huge volumes of imported shale gas from the United States have provided the ample supply for Mexico’s growing energy needs, keeping power prices down for industries and households.

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Dallas Fed Energy Survey

Lingering pessimism, uncertainty further weigh on oil and gas activity

Activity in the oil and gas sector edged lower in fourth quarter 2025, according to oil and gas executives responding to the Dallas Fed Energy Survey.

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Featured event

Energy and the Economy: The Geography of Energy Flows

The tenth joint energy conference hosted by the Federal Reserve Banks of Dallas and Kansas City will focus on the outlook for global energy markets as well as energy trade flows and developing domestic energy infrastructure. Participants include business leaders, central bankers, government officials, academics and financial market representatives.

November 14, 2025

Denver and virtual

See the agenda

Center for Energy and the Economy