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Is more competition better? Retail electricity prices and switching rates in the European Union

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  • Amenta, Carlo
  • Aronica, Martina
  • Stagnaro, Carlo

Abstract

The European Union (EU) promotes the liberalization of retail electricity markets to achieve lower prices, diversified offers, greater customer participation, and sustainable consumption behaviours. While retail competition has been a reality in most EU member states, most studies find that retail competition is suitable for large customers, but the evidence on small customers is inconclusive. We analyze data on electricity prices and switching rates in 27 EU member states and the UK from 2000 to 2019. We find that retail competition is associated with lower prices and that the effect of full liberalization is greater than that of partial liberalization.

Suggested Citation

  • Amenta, Carlo & Aronica, Martina & Stagnaro, Carlo, 2022. "Is more competition better? Retail electricity prices and switching rates in the European Union," Utilities Policy, Elsevier, vol. 78(C).
    • Handle: RePEc:eee:juipol:v:78:y:2022:i:c:s0957178722000704
    DOI: 10.1016/j.jup.2022.101405
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    3. Muhammad Babar Shahzad & Imran Bashir Dar & Raniyah Wazirali, 2023. "The Fear of the Known and Unknown in Being the Sustainable Business: Environmental Concern Reflected by Axfood (Sweden)," Sustainability, MDPI, vol. 15(6), pages 1-9, March.
    4. Hester M. Huisman & Evert de Haan & Machiel Mulder & Jaap E. Wieringa, 2026. "The impact of energy retailers’ loyalty programmes on the effectiveness of regulation of retail energy markets," Journal of Regulatory Economics, Springer, vol. 69(1), pages 1-33, December.
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    7. Hassan, Qusay & Nassar, Ahmed K. & Al-Jiboory, Ali Khudhair & Viktor, Patrik & Telba, Ahmad A. & Awwad, Emad Mahrous & Amjad, Ayesha & Fakhruldeen, Hassan Falah & Algburi, Sameer & Mashkoor, Saoud Cha, 2024. "Mapping Europe renewable energy landscape: Insights into solar, wind, hydro, and green hydrogen production," Technology in Society, Elsevier, vol. 77(C).
    8. 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).
    9. Dormady, Noah & Roa-Henriquez, Alfredo & Hoyt, Matthew & Pesavento, Matthew & Koenig, Grace & Welch, William & Li, Zejun, 2025. "How are retail prices formed in restructured electricity markets?," Energy Economics, Elsevier, vol. 143(C).
    10. Chen, Huanhuan & Li, Jinke & O'Leary, Nigel & Shao, Jing, 2025. "Higher prices in a more competitive market: The paradox in the retail electricity market in the United Kingdom," Structural Change and Economic Dynamics, Elsevier, vol. 72(C), pages 374-390.

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