Drivers of the Choice of Electricity Products and the Effect of Switching to a Green Default

Contribution to the Symposium Proposal 'Energy Transition Risks, Uncertainties and Societal Values' convened by P. Schweitzer and N. Pidgeon The promotion of renewable energies represents a main pillar to the successful... [ view full abstract ]

Contribution to the Symposium Proposal 'Energy Transition Risks, Uncertainties and Societal Values' convened by P. Schweitzer and N. Pidgeon

The promotion of renewable energies represents a main pillar to the successful implementation of the aspired energy transition. However, besides supporting the production of renewables and the implementation of related infrastructure, people must also opt for green electricity products. One potential way to increase the consumption of green electricity is to use nudging principles, such as introducing green electricity as the default option. However, little is known regarding how consumers perceive green defaults and how such defaults actually influence consumers’ product choice. To shed light on the drivers of electricity product choice and the perception and effectiveness of green defaults, we conducted a survey among customers of a Swiss electricity supplier using stratified sampling by electricity product chosen (N = 963). Analyses revealed that trust in the electricity supplier regarding the promotion of renewable energies and the proper use of eco-labels is a main driver of customers’ choice of the electricity mix. People who were more skeptical about the supplier’s investment in renewables and product labeling and its underlying motivation were less likely to opt for a green product. Positive attitudes towards solar, wind, and hydroelectric power and their perceived environmental-friendliness were identified as further critical factors influencing product choice in favor of green products. Financial considerations emerged to be a strong driver for customers opting for the cheapest electricity product, that of electricity generated using nuclear power. Switching to a green default proved to be an effective measure to increase consumption of renewable energies. Only about 30% of the study participants chose to opt out and switch to the previous cheaper product with electricity originating from nuclear power plants. The remaining participants kept the green default or even chose a more expensive green product. Customers with the opinion that the default product should be the cheapest one were more likely to switch back to the cheaper product, while people who considered the present green default appropriate tended to stay with the green default. The present research demonstrates the effectiveness of green defaults in promoting consumption of renewable energies. Furthermore, it points to the importance of trust in the electricity supplier and the credibility of eco-labels when it comes to the purchase of green energy.