Sung Je Byun

This is a substantially revised version of an earlier manuscript which was circulated under the title,“Idiosyncratic financial risk and a reevaluation of the market risk-return tradeoff,” which itself was a substantially revised version of an even earlier manuscript circulated under the title, “Real risk or paper risk?

Power purchase agreements (PPAs) are essential for the development of renewable energy projects such as wind and solar farms in the United States. In some regions, utility companies have been the primary buyers under these long-term contracts. However, an increasing number of corporations are now seeking PPAs to directly obtain renewable energy, bypassing traditional electricity procurement.

Oil prices have swung dramatically in recent years, shaped by geopolitical conflicts, evolving global demand and shifting energy policies. While media attention tends to focus on the impact on major oil producers and international markets, the consequences of these fluctuations are often deeply felt in smaller communities across the U.S. regions where oil and gas activity form the backbone of the local economy. This led to a significant reduction in the number of active drilling wells (Chart 1).