A measure of switching Costs in the GB electricity retail market

Evens Salies

SciencePo Working papers Main from HAL

Abstract: In most liberalised electricity retail markets, incumbent firms still hold the majority of residential consumers. This situation focused the attention of regulatory institutions and energy economists on the determinants of consumers switching decisions. Fewer studies have, however, been devoted to measuring switching costs. In the present paper we calculate these costs in the Great Britain electricity retail market by revisiting the model suggested in Shy, O. (2002), A quick-and-easy method for estimating switching costs, International Journal of Industrial Organization, 20, pp. 71–87. The average net cost of switching regional incumbents is €385 while the net cost of switching back to them is negative for customers on standard credit or direct debit plans but positive for prepayment customers.

Date: 2022-03-01
Note: View the original document on HAL open archive server: https://hal-sciencespo.archives-ouvertes.fr/hal-03592459
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Working Paper: A measure of switching Costs in the GB electricity retail market (2022)
Working Paper: A Measure of Switching Costs in the GB Electricity Retail Market (2007)
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