Glossary of Terms

Balancing Charges - The charges applicable to a customer's adjusted imbalance volume when Daily Balancing Service is elected.

Bundled Service - Providing full-service energy, including generation, delivery, meter reading and customer service. This is how you received energy in the past.

Competition - Allowing two or more companies to sell similar goods and services in the same market. In this case, energy generation or supply.

Customer Choice - The ability of energy customers to shop, compare prices and choose the company that generates or supplies their natural gas or electricity.

Energy Deregulation - The process of changing the laws and regulations which control the energy industry, to allow competition and customer choice of energy supply. This process is also called restructuring, where the various utility functions, (generation, supply, delivery, etc.) are separated into individually owned and operated entities.

Distribution - The process of delivering natural gas or electricity through pipes or wires to a customer's home or business. The cost to provide this service is included in the delivery-service portion of the customer's bill.

Energy Service Company (ESCO) - An energy company that offers to supply the actual commodity of electricity. ESCOs are sometimes referred to as marketers.

Electricity - A flow of charged particles (electrons) that has magnetic, radiant and chemical effects.

Federal Electricity Regulatory Commission (FERC) - The independent regulatory agency within the U.S. Department of Energy that approves rates for for wholesale electric sales of electricity and transmission in interstate commerce for utilities, marketers, independent system operators, etc.

Firm Service/Energy - An energy supply that is guaranteed to be delivered under the terms defined by a contract. Firm service is more reliable and expensive than interruptible service.

Force Majeure - A contractual clause that allows the parties to suspend the contract obligations because of Acts of God, natural disasters or acts of man, which are beyond the control of the parties. For example, ice storms, freeze-offs, strikes, hurricanes, earthquakes, power line breaks, etc.

Fossil Fuels - Fuels formed in the ground during prehistoric times from the remains of dead plants and animals. For example, oil, natural gas and coal.

Fuel - Any material that can be burned to make energy and produce heat.

Generation - The process of producing electrical energy.

Generation Company - An entity that generates electricity.

Independent System Operators (ISOs) - An entity sanctioned by the FERC, which controls a power system without special interest. ISOs own no generation, transmission or load.

Interruptible Service/Energy - Electricity supplied under agreements that allow the supplier to curtail or stop service at times. It is less reliable and less expensive than firm service.

Kilowatt (kW) - A unit of measure equal to 1,000 watts, which describes the rate of energy use. For example, ten 10O-watt light bulbs use one kilowatt of electricity.

Kilowatt-Hour (kWh) - The most commonly used unit of measure telling the amount of electricity consumed over time. It means one kilowatt of electricity supplied for one hour. For example, ten 10O-watt light bulbs used for 10 hours would equal 1,000 watt hours, or ten kilowatt-hours of use.

Line Loss - Electrical energy lost due to inherent inefficiencies in an electric transmission and distribution system under specific conditions.

Market-Based Price - A price set by the mutual decisions of many buyers and sellers in a competitive market.

Meter - A device for measuring levels or volumes of a customer's electricity use.

Off-Peak - Blocks of time when energy demand and price are low. For example, at night, when people are sleeping.

Oil - A product of crude oil that is used for space heating, diesel engines and electrical generation.

On-Peak Demand - Blocks of time when energy demand and price are high. For example, mornings when people are getting ready for work.

One Bill/Two Bill Option - The option to receive one bill listing both energy supply and delivery charges, or to receive two bills: one from the supplier for energy charges and one from the local utility for delivery charges.

Outage - An interruption of electricity service that is temporary (minutes or hours) and affects a relatively small area (buildings or city blocks).

Pipeline - A line of pipe with pumping machinery for transmitting a liquid or gas

Propane - A gas that is both present in natural gas and refined from crude oil. It is used for heating, lighting and industrial applications.

Public Service Commission (PSC) - An agency that is responsible for regulating each state's public utilities. The PSC oversees deregulation of the energy industry at the state level.

Retail Competition - A system under which more than one provider can sell to retail customers, and retail customers are allowed to buy from more than one provider.

Slamming - The illegal practice of switching a customer's energy supply service without his or her authorization.

Supplier - A company that has been licensed by the Public Service Commission to sell energy to customers in a particular state.

Tariff - A document, approved by the responsible regulatory agency, that lists the terms and conditions under which energy services will be provided.

Unbundled Service - Separates energy generation or commodity from all the other services required to provide delivery of energy to a home or business. The supply of energy generally represents about 65 percent of the customer's bill.

Utility/Local Distribution Company (LDC) - A company engaged in the sale and/or distribution of natural gas or electricity for ultimate consumption by homes, commercial buildings and industrial plants.