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The switching behavior of large-scale electricity consumers in The Turkish electricity retail market

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  • Erdogan, Murside Rabia
  • Camgoz, Selin Metin
  • Karan, Mehmet Baha
  • Berument, M. Hakan

Abstract

This paper studies the effects of various economic and psychological factors on the switching behavior of large-scale electricity consumers in Turkey. Switching frequency and switching direction are two variables used to analyze switching behavior. The former is concerned with how often retailers change their suppliers. On the other hand, switching direction measures the direction of switching preferences of consumers between two electricity suppliers since the incumbent has a brand advantage over new suppliers that creates inertia and may reduce competition in the market. The target group of this study is large-scale electricity consumers rather than residential consumers since the switching activities of large-scale consumers are more competitive. We employ a five-point Likert scale questionnaire to construct eight psychological and economic factors to explain switching activities. The estimates indicate that improving service quality and providing essential services are the main motivations for switching decisions. Satisfaction with primary services, the homogeneity of the retail electricity market, and switching costs enhance the status quo; however, clarity of contracts and assistance for electricity distribution services (maintenance, metering, billing, etc.) affect the switching activities.

Suggested Citation

  • Erdogan, Murside Rabia & Camgoz, Selin Metin & Karan, Mehmet Baha & Berument, M. Hakan, 2022. "The switching behavior of large-scale electricity consumers in The Turkish electricity retail market," Energy Policy, Elsevier, vol. 160(C).
    • Handle: RePEc:eee:enepol:v:160:y:2022:i:c:s0301421521005668
    DOI: 10.1016/j.enpol.2021.112701
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    6. Hussain, Shahid & Seet, Pi-Shen & Ryan, Maria & Iranmanesh, Mohammad & Cripps, Helen & Salam, Abdul, 2022. "Determinants of switching intention in the electricity markets - An integrated structural model approach," Journal of Retailing and Consumer Services, Elsevier, vol. 69(C).
    7. Thomasi, Virginia & Siluk, Julio Cezar M. & Rigo, Paula D. & Pappis, Cesar Augusto de O., 2024. "Challenges, improvements, and opportunities market with the liberalization of the residential electricity market," Energy Policy, Elsevier, vol. 192(C).

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    More about this item

    Keywords

    Energy markets; Switching supplier; Business economics and logit model;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • R29 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Other

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