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glossary of terms

glossary of terms

At Energy & Carbon Management, we like to try and keep things simple. However, from time to time, you’ll see that we use some industry jargon (and there’s lots of it!). Here we’ve provided a quick overview of some of the terms you may see across our content and collateral.


Agreed Supply Capacity (ASC)

The maximum electricity demand that a business agrees they need to have from their supplier. This agreed amount of electrical load will be stated in the property’s Connection Agreement with the local Distribution Network Operator (DNO). It is also referred to as Maximum Import Capacity, Authorised Capacity or Available Capacity and is measured in Kilo-Volt Ampere (kVA).

Air-conditioning Inspection (ACI)

Under the European Energy Performance of Buildings Directive (EPBD), all air-conditioning systems require regular inspections by an accredited Energy Assessor at intervals of not greater than 5 years. This is often referred to as an ACI.

Air Handling Unit (AHU)

An equipment package that includes a fan or blower for providing Heating, Ventilation, and Air Conditioning (HVAC) to a building. Efficiency is improved through enabling control.

Air Source Heat Pump (ASHP)

An air source heat pump (ASHP) is a system which transfers heat from outside to inside a building, or vice versa. 


A unit of electrical current.

Anaerobic Digestion

A biological process that produces a gas principally composed of methane (CH4) and carbon dioxide (CO2) otherwise known as biogas. These gases are produced from organic wastes such as livestock manure, food processing waste, etc. to manage waste or produce fuel.

Annual Agreed Quantity (AQ or AAQ)

The AAQ is the sum of the annual consumption of all meters on a site. This comes from National Grid, and is based on historical usage from previous years. Measured in kWh (electricity) or Therms (gas). Supply Point AQ is the total annual consumption of all meters on a site. See also: Meter Point AQ; Supply Point AQ.

Automated Meter Reading (AMR)

Automated Meter Reading is the automatic collection of consumption data from meters which can be transferred to a central database for billing and/or analysis.

Availability (kVA)

Availability (kVA) or 'Agreed Supply Capacity' refers to the limit of capacity for a site, e.g. if a site has an Availability of 150 kVA then maximum demand should not exceed that figure at any time.

It is set and charged for by the local Distribution Network Operator (DNO), according to the kVA of a premise. This fee covers investment and maintenance of the electricity network and can also be called the Capacity Charge. Clients pay a fee (per unit) according to the agreed capacity for that site. In theory, maximum demand should not exceed the agreed capacity at any time.



Description of a market when spot prices are higher than rates for futures

Balancing Mechanism

This is one of the tools National Grid uses to balance electricity supply and demand close to real time. It is needed because electricity cannot be stored and must be manufactured at the time of demand.

Where National Grid predicts that there will be a discrepancy between the amount of electricity produced and that which will be in demand during a certain time period, they may accept a ‘bid’ or ‘offer’ to either increase or decrease generation (or consumption). The balancing mechanism is used to balance supply and demand in each half hour trading period of every day.

Balancing Services Use of System Charges (BSUoS)

The BSUoS charge recovers the cost of day to day operation of the transmission system. Generators and suppliers are liable for these charges, which are calculated daily as a flat tariff across all users.

Balgzand Bacton Line (BBL)

A natural gas pipeline between the Netherlands and the UK, allowing gas imports.

Base Load

The base load is the level below which electricity demand never drops, i.e. a site with a high maximum demand of 750 kVA whose demand never drops below 250 kVA would have a base load of 250 kVA. Alternatively, a block of flat volume of any size.


Believing that market prices are about to fall. Also describes a market which shows signs of falling.

The Department for Business, Enterprise and Regulatory Reform (BERR)

The Department for Business, Enterprise and Regulatory Reform (BERR) was a United Kingdom government department. The department was created on 28 June 2007 on the disbanding of the Department of Trade and Industry (DTI), and was itself disbanded on 6 June 2009 on the creation of the Department for Business, Innovation and Skills.


The partial reduction of electrical voltages caused by client demand being higher than anticipated or by the failure of the generation, transmission, or distribution system.


Fuels produced from biodegradable material. Biodiesel fuels, for example, are typically made from oils such as soybeans, rapeseed, or sunflowers, or from animal tallow. Biogases can be produced from methane-rich sources such as landfill or sewage.

Brent Crude

Brent crude – also referred to as Brent blend – is one of three major oil benchmarks used by those trading oil contracts, futures and derivatives. Oil benchmarks provide a useful way for oil traders and speculators to know which type of oil they are trading. Oil from different fields varies in value thanks to its use in different industries, and varying ease of transport.


Biomass is degradable biological material, auch as wood waste, which can be used to generate biofuels.


A general term used when a stock market is on the rise.


Calorific Value (CV)

A measure of the heating power of gas. The CV refers to the amount of energy released when gas is combusted under specified conditions. The CV of gas is usually given in megajoules per cubic meter (MJ/m3).

Carbon Dioxide (CO2)

A gas produced by fossil-fuel combustion as well as other natural processes. It is a normal part of the Earth's atmosphere. CO2 is considered a greenhouse gas as it traps heat into the atmosphere and contributes to the potential for global warming.

Carbon Footprint

The impact human activities have on the environment. This is measured by the amount of greenhouse gases (usually Carbon Dioxide) produced by a particular activity.

Carbon Price Floor

A mechanism intended to improve incentives for investment in low-carbon electricity generation by setting a minimum price for carbon emissions, which would increase the price paid for generation by fossil fuel fired power stations.

Carbon Monoxide (CO)

Carbon monoxide is produced from the partial combustion of carbon-containing compounds such as gas. It is silent, colourless, odourless and potentially lethal. To prevent against carbon monoxide exposure you should ensure gas appliances, such as your boiler, are installed and serviced regularly by a CORGI registered engineer. In addition, all businesses have a responsibility to ensure appliances meet the Gas Safety (Installation and Use) Regulations 1998 and The Health and Safety at Work Act 1974.

Carbon Offsetting

A carbon offset is a financial instrument aimed at a reduction in greenhouse gas emissions. Carbon offsets are measured in metric tons of carbon dioxide-equivalent (CO2e) and may represent six primary categories of greenhouse gases.  One carbon offset represents the reduction of one metric ton of carbon dioxide or its equivalent in other greenhouse gases.

(The) Carbon Trust Standard

The Carbon Trust Standard was developed by the Carbon Trust to encourage good practice in carbon measurement, management and reduction by businesses and public sector organisations.


The rated load-carrying capability of electrical equipment such as generators of transmission lines, typically expressed in megawatts or megavoltamperes. For Gas, this would be the rated transportation volume of natural gas pipelines, typically expressed in millions of cubic feet per day.

Capacity Charge

A set charge by the local Distribution Network Operator (DNO) for investment and maintenance of the electricity network, based on the Agreed Capacity of a property. This can also be called the Availability Charge.

Capacity Market

The Capacity Market (CM) is one of the main building blocks of the UK Government’s Electricity Market Reform (EMR) programme. Its goal is to ensure adequate capacity within an electricity system that in future will rely increasingly on intermittent wind and inflexible nuclear generation. The Capacity Market ensures security of electricity supply by providing a payment for reliable sources of capacity.

Consumer Council for Water (CCWater)

A statutory body established to monitor and advice on water issues for ALL customers.  Will also handle customer complaints that have been resolved through the standard procedures.

Clean Dark Spread

The theoretical gross margin of a coal-fired power plant from selling a unit of electricity, having bought the fuel required to produce this unit of electricity.

Clean Spark Spread

The theoretical gross margin of a gas-fired power plant from selling a unit of electricity, having bought the fuel required to produce this unit of electricity.

Climate Change Levy (CCL)

The Climate Change Levy (CCL) is a tax on energy delivered to non-domestic users in the United Kingdom. Its aim is to provide an incentive to increase energy efficiency and to reduce carbon emissions.

Closing price

The price of the market at the end of the trading day.

Collective Purchasing

Also known as a procurement 'portfolio' or 'basket'. A 'collective' comprises a collection of meters whose volume is aggregated together to trade in the market.


The natural market situation whereby the anticipated value of the spot market in the future is higher than the current spot market

Combined Heat and Power (CHP)

A power generation plant which produces electricity and uses the waste heat generated to warm a building or buildings. This may be small scale inside a factory or large scale where heat from a power station is used to provide heating for a local district containing domestic, commercial and industrial premises.

Combined Half Hourly (HH) Data Charge

Costs associated with collecting and handling metering data from half hourly (HH) read meters.

Communication Charges

Communication charges cover the cost of the telephone line or cellular link used for remote access to the electricity meter. This applies to half-hourly metered sites only. Communication charges can be billed to the customer by either the meter operator or the supplier.

Correction Factor (CF)

Used to convert gas units into kilowatt-hours (kWh).  It takes into account changes in the volume of the gas based on temperature and pressure, which can vary slightly for different supplies. This makes sure all customers receive the same number of kWh for each cubic meter of gas that is supplied to them. The correction factor is 1.02264, which is standard across all suppliers and this is displayed on your bill.

Comfortable supply

Referring to the gas market, it means that supply fundamentals are strong i.e. there is enough supply to meet demand. This scenario can push prices down, but usually only for the next day.

CRC Energy Efficiency Scheme (CRCEES)

The CRC Energy Efficiency Scheme (often referred to as simply ‘the CRC’) is a mandatory scheme aimed at improving energy efficiency and cutting emissions in large public and private sector organisations.

Cubic Foot (cf)

A unit of measurement for natural gas.

Cubic Metre (m3)

A unit of measurement for water = 1,000 litres


Refers to energy which can be bought further in advance of delivery than “prompt”. This consists of a near curve, which refers to the closest six months, and the far curve which tends to refer to the quarters and seasons further out.

Customer Own Reading (COR)

A meter reading provided by a customer.


Data Collector (DC) 

Data collectors (DC) read meters and keep records of previous meter readings. They’re also responsible for doing visual safety checks of meters when they read them. The DC is appointed by the Suppliers to retrieve and validate metering data and forward it, by Metering System, to the Data Aggregator. The DC may be appointed by the customer but must always be accredited and contracted to the customer’s Supplier.

Data Logger 

A device used to record meter readings and automatically transmit them to the meter reading agency.

Day-ahead Market

A traded market for the delivery to be the following day.

Deemed Contract 

A contract which is deemed to apply when a customer begins a new supply at a property and has not signed a written contract for its supply. These contracts have a defaulted rate for supply until a customer requests a fixed price for a fixed period.

Degree Day (Heating)

A numerical index used to measure how hot or cold the weather was at a given location over a period of time, determined by the difference between a baseline temperature (usually 15.5°C in the UK) and the actual outdoor temperature multiplied by the number of days.

Delivery Window

A collection of months (generally a 12 month period) where the traded volume is supplied and billed to the customer by the appointed energy company.


The rate at which electric energy is used in any instant or average over a period of time. Usually expressed in kilowatts (kW) or kilovolt-amperes (kVA). See also Maximum Demand.

Demand Side Response (DSR)

Demand side response is the scheme where customers are incentivised financially to lower or shift their electricity use at peak times. This will help manage load and voltage profiles on the electricity network.

Department of Energy and Climate Change (DECC)

The Department of Energy and Climate Change (DECC) was created in October 2008, bringing together energy policy previously with BERR and DEFRA.

Department for Environment, Food and Rural Affairs (DEFRA)

DEFRA is the UK government department responsible for policy and regulations on environmental, food and rural issues. Their priorities are to grow the rural economy, improve the environment and safeguard animal and plant health.

Distribution Network Operators (DNO)

Companies that are responsible for operating the networks that connect electricity consumers to the national transmission system and provide interconnection with embedded generation. There are 14 regional distributors who maintain the electrical network.

Distribution Use Of System Charges (DUOS)

These charges are published costs made by each Distribution Company for delivering electricity from the Grid Supply Point to the customer’s premises.

Display Energy Certificate

Following the recast of the Energy Performance of Buildings Directive (EPBD); a Display Energy Certificate will be required for Public buildings over 500m² occupied or part occupied by public authorities or by institutions providing public services and therefore frequently visited by the public.

Dual Fuel

Indicates the supply of more than one energy type, e.g. gas and electricity. Also known as "combined energy".

Data Aggregator (DA)

The Data Aggregator or DA is the organisation appointed for aggregating the meter-reading data received from the Data Collectors and forwarded to the suppliers.


Applicable for buildings greater than 250m2.

Default Tariff (Water)

The maximum price a retailer can charge for water services.


Electricity Generation Capacity

The maximum level of electricity that can be generated by a plant under optimum conditions.

Energy Only

An offer of electricity that has no third party charges added at the point of quotation.

Environment Agency (EA)

Executive non-departmental public body responsible for protecting and improving the environment in England and Wales.

Energy Performance of Buildings Directive (EPBD)

The Energy Performance of Buildings Directive (EPBD) was approved on 16 December 2002 and brought into force on 4 January 2003. The principal objective of the Directive is to promote the improvement of the energy performance of buildings within the EU through cost-effective measures.

Energy Performance Certificate (EPC)

In response to the Energy Performance of Buildings Directive (EPBD); as of 6th April 2008, all commercial property for sale, let or in construction now require a commercial Energy Performance Certificate (EPC). An EPC gives a property an energy efficiency rating from A (most efficient) to G (least efficient).


The release of gases into the atmosphere. Often refers to the emission of greenhouse gases, such as carbon dioxide, during fuel combustion.

European Trading Scheme (ETS)

An EU wide system for trading greenhouse gas emission allowances which covers more than 11,000 power stations and industrial plants in 31 countries.

EU Allowance (EUA)

A permit to emit one tonne of CO2 under the EU Emissions Trading System.

EU Emissions Trading Scheme (EU ETS)

A European Union scheme to reduce emissions of carbon dioxide and other greenhouse gases to meet targets set out in the Kyoto Protocol.


The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment and savings identification scheme for large organisations in the UK.


Electronic Data Interchange (EDI)

Electronic Data Interchange (EDI) is the electronic interchange of business information using a standardised format; a process which allows one company to send information to another company electronically rather than with paper. In the case of utility billing, suppliers will often provide data in an EDI format to ensure compatibility across systems.


Feed-in Tariffs (FiTs)

Payments made by FIT licensed electricity suppliers to energy users who generate their own electricity. They are designed to encourage the adoption of renewable energy sources and to help accelerate the move toward grid parity.

Fixed Contract

A procurement contract whereby the unit rates stay at one price for the duration of the plan.

Flexible Contract

A procurement contract whereby the price risk is spread over a number of purchasing decisions throughout the year.

Forwards Contract

An agreement to buy electricity from another party at a specified time in the future at a specified price with money changing hands at the delivery date.

Fossil Fuels

Fuels such as coal, oil and gas which have been formed from the decomposition of ancient plant and animal matter.

Front months

This refers to the three months after the current calendar month. For example, if it’s currently February, the front months are March, April and May.

Fuel Mix

The mix of fuels used to generate electricity. Electricity can be sourced from a variety of sources – coal, gas, nuclear and renewable.

Frequency Response

System frequency is a continuously changing variable that is determined and controlled by the second-by-second (real time) balance between system demand and total generation. If demand is greater than generation, the frequency falls while if generation is greater than demand, the frequency rises.


Gas Day

Gas companies may define the start and end of their “Gas Day” in terms of 06.00 to 06.00, 08.00 to 08.00 or 12.00 to 12.00. This is very important contractually.

Gas Transporter (GT)

Responsible for maintaining a gas supply network, a Gas Transporter, licensed by Ofgem, transports gas through its network on behalf of a gas shipper. 

Global Warming

An increase in the Earth's surface temperature. Global warming has occurred in the past as the result of natural influences, but the term is today most often used to refer to warming resulting from the emissions of greenhouse gases.

Grid Supply Point (GSP)

The (GSP) is the point at which energy is taken from the National Grid transmission system into a local distribution system.

Gigawatt (GW)

A unit of power equivalent to one thousand megawatts  (MW) or one million kilowatts (kW) or one billion watts.

Green Certificates

An official record proving that a specified amount of green electricity has been generated. Green certificates represent the environmental value of renewable energy production. The certificates can be traded separately from the energy produced. Also known as Renewable Energy Certificates (REC's).

Greenhouse Gas (GHG)

A gas that absorbs infra-red radiation (i.e. the sun’s heat and energy) in the atmosphere. Greenhouse gases include water vapour, carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), halogenated fluorocarbons (HCFCs), ozone (O3), perfluorinated carbons (PFCs), and hydrofluorocarbons (HFCs). These gases contribute to the 'greenhouse effect'.

Greenhouse Gas (GHG) Protocol

A widely used standard for emissions reporting. The protocol covers project emissions reporting and corporate emissions reporting. The corporate emissions reporting standard provides a methodology for calculation of a carbon footprint. The protocol was developed by the World Resources Institute and the World Business Council for Sustainable Development.

Ground Source Heat Pump (GSHP) 

A type of heat pump that uses the natural heat storage ability of the earth and/or the groundwater to heat and/or cool a building. The earth has the ability to absorb and store heat energy from the sun. To use that stored energy, heat is extracted from the earth through a liquid medium (groundwater or an anti-freeze solution) and is pumped to the heat pump or heat exchanger. There, the heat is used to heat the building. In the summer, the process is reversed and indoor heat is extracted from the building and transferred to the earth through the liquid.


Half Hourly Data (HHD)

HHD is the product of the half-hour data meter. The data is usually made available to end users by way of a spreadsheet or online reporting platform. A full years' half-hour data will be a spreadsheet with approximately 18,520 cells of data.


A strategy or purchase which is used to reduce the risk of adverse price movements.

Highway Drainage

A charge levied by water companies for the handling of rainwater etc that fall on public roads.  Known in Scotland as "Roads" drainage.

Half Hourly (HH) Meters

Since April 1998, code 5 meters have been mandatory for all sites over 100 kVA, and voluntary for sites under 100 kVA. This meter sends your consumption record by telephone or radio every half-hour to a central data bank. The supplier will then receive this information from the data collector and bill the client accordingly.

High Voltage (HV)

High Voltage (11,000 Volts or above).

Heating, Ventilation and Air-Conditioning (HVAC)

Heating, ventilation, and air conditioning (HVAC) is the technology of indoor and vehicular environmental comfort.



A situation where there is a difference between the amount of power produced (supply) and the amount of electricity contracted or sold (demand). At such times spare capacity in the system can be brought on stream, normally at a much higher cost than the contracted price.

Interconnector (Gas)

Gas interconnectors connect gas transmission systems from other countries to the National Transmission System (NTS) in England, Scotland and Wales. There are currently three gas interconnectors which connect to the NTS. These are: IUK interconnector to Belgium. Balgzand to Bacton Line (BBL) to the Netherlands.

Interconnector (Electricity)

Interconnectors are transmission cables that allow electricity to flow from one country to another.

See Ofgem for more details: https://www.ofgem.gov.uk/electricity/transmission-networks/electricity-interconnectors.

ISO 50001:2011

Launched in June 2011, the ISO 50001:2011 is the new international standard for energy management. Using energy efficiently helps organisations save money as well as helping to conserve resources and tackle climate change. ISO 50001 supports organisations in all sectors to use energy more efficiently, through the development of an Energy Management System (EnMS).


Joule (j)

A unit of measurement for energy equal to one watt-second.


Kilovolt Amperes (KVA)

A unit of electrical power equal to 1000 volt-amperesin kVA. kVA = kW/power factor.

Kilowatt (kW)

A standard unit of electrical power equal to 1,000 watts. 

Kilowatt Hour (kWh)

A measure of electrical energy. One kilowatt hour (kWh) of energy is the energy produced by one kilowatt acting for one hour. Electricity meters record in kilowatt hours and electrical consumption is billed on kilowatt hours.

Kyoto Protocol

An international agreement signed in December 1997 that introduced emissions targets to be achieved by the period 2008 - 2012.


Langeled Pipeline

The Langeled pipeline (originally known as Britpipe) is an underwater pipeline transporting Norwegian natural gas to the United Kingdom.

Large Combustion Plant Directive (LCPD)

A European Union directive which required member states of the European Union to legislatively limit flue gas emissions from combustion plant having thermal capacity of 50 MW or greater.

Letter of Authority (LOA)

A Letter of Authority (LOA) is a document signed by a business that allows a third party (normally an Energy Broker) to correspond with UK Energy Suppliers.  A separate, specific LoA is usually required for water services.

Liquefied Natural Gas (LNG)

Natural gas that has been liquefied by reducing temperature or increasing pressure. Its liquefied state means it takes up less space and makes storage and transportation easier.

Liquefied Petroleum Gas (LPG)

A natural hydrocarbon fuel largely made up of propane and butane. A gas at atmospheric pressure, it is liquefied by reducing temperature or increasing pressure. Its liquefied state means it takes up less space and makes storage and transportation easier.


Refers to the ability of market participants to enter into or unwind a position. For example if liquidity was poor, it would be hard to make transactions and would usually be characterised by limited market activity.

Load Factor

Ratio of average energy demand (load) to maximum demand (peak load) during a specific period. Usually stated as a percentage, or number of hours used.

Low Voltage (LV)

Low Voltage, normally at 240 or 415 Volts.


Maximum Demand (MD)

Maximum Demand is the highest peak of usage (kWh) in any Half Hour during a calendar month or between two meter readings measured in either kW or kVA. This value is multiplied by 2 to give the MD on an hourly basis.

M3 (m3)

Standard abbreviation for cubic metre of water = 1,000 litres.

Megalitre (ML)

1,000 cubic metres of water.

Megawatt (MW)

A unit of power equivalent to one thousand kilowatts (kW) or one million watts (W).

Mark to market

Denoting or relating to a system of valuing assets by the most recent market price.

Mega Watt hour (MWh)

Mega Watt hour, one thousand kWh. A 1 MW power-generating unit running for 1 hour produces 1 MWh of electrical energy.

Meter Serial Number (MSN)

This is a unique number which should be clearly visible on the front of the meter. This would change with the installation of a new meter.

Meter Point Administration Number (MPAN)

A 21 digit reference, used to uniquely identify the electricity supply point. Although the name suggests that an MPAN refers to a particular meter, an MPAN can have several meters associated with it.

Meter Point Reference Number (MPRN) Gas

A unique meter point reference number that identifies a specific gas supply point and will not change even if the meter is replaced.


Combined Heat and Power, but in very small scale, typically below 5kW electrical output, (e.g. in the residential and commercial sectors). It is likely to operate in place of a domestic central heating boiler.


The small-scale generation of energy, for example solar panels or domestic wind turbines. These are often referred to as generation from renewable sources at a domestic or small community level.

Moffat Pipeline

A gas pipeline from the UK to Ireland, allowing gas exports.

Mogden Formula

A formula for determining charges for trade effluent for any given customer. In addition to volume, it takes account of the costs of collection, primary and biological treatment, solid content and disposal.   

Market Operator Services Ltd (MOSL)

Market Operator Services Ltd is the body responsible for delivery of the systems and processes to enable the competitive water services market in England to function.


National Grid

The National Grid owns the main transmission systems and is responsible for transmitting the electricity from the generator to the local REC’s area.

Natural Gas

Gas consisting of methane and ethane. Occurs naturally in the Earth's crust.

National Balancing Point (NBP)

The NPB is the reference point for prices on the UK gas market and the virtual trading location for the sale and purchase of natural gas in the UK.

Non Half Hourly (NHH) Meters

Unlike HH meter a meter reader must visit the site to obtain readings. 

Non-Potable Water

Water that has not been treated to the standard required for it enter the public distribution network.  It is therefore not suitable for human consumption.   Often used in industrial processes, for cooling etc.

Non Return to Sewer (NRS)

An allowance used to determine the percentage of water supplied that is not taken away as wastewater due to evaporation, use in product, consumption etc.

Typically water companies assume 95% of water supplied ends up as wastewater and use this factor when calculating sewerage volume charges. The onus is on the customer to prove a lower percentage should be used than that determined by the water company.

Notice of Objection

This is the communication sent by the Initiating Supplier to the GT when in receipt of notice of a Supply Point confirmation request to retain registration for a particular Supply Point.

Northern Ireland Environment Agency (NIEA)

Responsible for advising on, and implementing, the Government's environmental policy and strategy in Northern Ireland.

Nuclear energy

Energy produced from a nuclear chain reaction of fissionable materials. Generated heat can be used to produce steam, drive turbines and generate electricity.


Official Journal of the European Community (OJEC)

OJEC is now recognised as OJEU - the Official Journal of the European Union.

Official Journal of the European Union (OJEU)

OJEU is the publication in which all tenders from the public sector which are valued above a certain financial threshold according to EU legislation, must be published.The legislation covers organisations and projects that receive public money. Organisations such as Local Authorities, NHS Trusts, MOD, Central Government Departments and Educational Establishments are all covered by the legislation.


The Office of Gas and Electricity Markets. The industry regulator.


Office of Water Services.  The economic regulator of the water and sewerage sectors in England and Wales.

Open Water

The body formed by Ofwat, Defra and MOSL responsible for delivery of market reform of water services in England.

Organisation of Petroleum Exporting Countries (OPEC)

An organisation of the worlds major oil-exporting nations  that aims to manage the supply of oil in an effort to set the price of oil on the world market.


Prompt market

Gas or electric that is for delivery within the current calendar month.  

Pass-through Charge

A pass-through cost is a cost that is charged to the energy supplier, but is then "passed through" directly to the consumer.

Percentage Day

This refers to the percentage ratio of electricity used in the daytime against that used in the night. This information is used by suppliers to quickly identify the type of profile.


Denotes the maximum power requirement of a system at a given time, or the amount of power required to supply customers at times when need is greatest. It can refer either to the load at a given moment (e.g. a specific time of day) or to averaged load over a given period of time (e.g. a specific day or hour of the day).

Peak Day

The highest demand for gas, or electricity, on any day in that year.


Pence per therm.

Power Factor

This relates to how efficiently electricity is used on your site. Certain types of equipment cause poor power factor which reduces the capacity of the network to supply power. Distribution Network Operators' (DNO) can charge customers for this through power factor charges.

PP10/ PP11 Certification

Certification to claim exemption or discount from the Climate Change Levy (CCL). PP10/PP11 certification must be completed and sent to HM Revenue & Customs and the energy supplier.

Potable Water

Water that meets the quality standard for human consumption (drinking).

Profile Class

Identifies the type of the electricity supply. 00 = Half Hourly Supply, 01-02 = domestic supply (NHH), 03-04 = quarterly supply (NHH) and 05-08 = monthly supply (NHH).


P272 is a mandatory industry-wide change instigated by OFGEM for the half-hourly (HH) settlement of profile class 5-8 meters that have capable metering in place, i.e. where AMR (Automatic Meter Reading) meters are fitted. Settlement is the process by which electricity volumes are allocated to suppliers.



Where energy can be bought in three month blocks, Jan-Mar, Apr-Jun, Jul-Sep or Oct-Dec.


Range Bound

Prices which moved in a tight range, showing no distinct movement.

Rateable Value (RV)

A notional rental value ascribed to a building by the relevant Valuation Agency based on its size, location and other factors. Used to determine the rates payable by the owner.  Can be used also as a basis for determining certain charges for water services, particulary for drainage in Scotland.

Reactive Charges

Charges applied to a client’s invoice in cases where certain suppliers and distribution companies enforce a penalty for Reactive Power use.

Reactive Power (kVArh)

This is the difference between the electricity supplied and the electricity converted into useful power. If the difference is large, i.e. there is a large amount of power being wasted, its puts an additional strain on the distribution network. The loss of power can be caused by kinetic energy (heat) or through defective machinery. This is measured via the Reactive register on a meter and is charged to the customer depending on how much they accumulate.

Regional Electricity Company (REC)

Regional Electricity Company. The UK is split into local electricity regions. Each REC is responsible for supply to domestic, commercial and industrial customers in its area. Also known as DNO.

Renewable Energy Certificates (REC's) 

RECs, also known as ‘Green Certificates’, green tags, or tradable renewable certificates, represent the environmental attributes of the power produced from renewable energy projects and are sold separate from commodity electricity.

Renewable Obligation (RO)

This is the main government market mechanism to support renewable energy. It is an obligation on all electricity suppliers to supply a certain amount of their electricity sales from accredited renewable sources under the Climate Change Levy exemption scheme.The new Renewables Obligation and associated Renewables (Scotland) Obligation came into force in April 2002 as part of the Utilities Act ( 2000 ). It requires power suppliers to derive a specified proportion of the electricity they supply to their customers from accredited renewable sources. This starts at 3% in 2003, rising gradually to around 10% by 2010 and 15.4% in 2015/16.

Renewables Obligation Certificate (ROC) 

Eligible renewable generators receive Renewable Obligation Certificates (ROCs) for each MWh of electricity generated. These certificates can then be sold to suppliers. In order to fulfil their obligation, suppliers can either present enough certificates to cover the required percentage of their output, or they can pay a ‘buyout’ price of £34.30 per MWh (set by Ofgem for 2007-2008) for any shortfall. All proceeds from buyout payments are recycled to suppliers in proportion to the number of ROCs they present.

Retailer (in water)

Under water market reform, the Licensed Retailer is responsible for customer facing activities, such as billing, meter reading and dealing with queries etc. The Retailer is the interface between the customer and the wholesaler.

From April 2017, all non-household customers will be able to choose their retailer, but generally not have any choice over their wholesale supplier.

Risk Management Committee

At Inprova Energy, this is an internal group to which the Lead Trader reports quarterly on decisions taken in purchasing open volumes for the collectives. It is within this committee that proposed changes to the strategic purchasing approach are considered.

Renewable Energy Guarantees Origin (REGO)

The Renewable Energy Guarantees of Origin (REGO) scheme provides transparency to consumers about the proportion of electricity that suppliers source from renewable generation. All EU Member States are required to have such a scheme.



Where energy can be bought in six month blocks, Oct-Mar or Apr-Sep.

Settlement Agency Fee

Elexon, the UK’s Balancing and Settlement Code Company, charge for making sure all parties involved in distributing, supplying and measuring energy supply are paid appropriately.

Scottish Environment Protection Agency (SEPA)

Scotland's environmental regulator responsible for protecting and improving the environment in England and Wales.


Waste matters discharged into the public sewer system through a series of drains and pipes.  Also known as wastewater or sewage.

Short Term Operating Reserve (STOR)

A service for the provision of additional active power from generation and/or demand reduction.

Smart Meters

Any meter which allows for the identification of consumption in more detail than a conventional meter. Smart meters will generally also include a means of communicating information to a central data collection site for energy management and/or billing purposes.

Spot market

The market where energy commodities are traded in cash/physically and delivered immediately, not as futures, i.e. gas or electric that is for delivery within the current trading day

Supply Point ID (SPID)

A unique meter point reference number that identifies a specific water or wastewater supply point and will not change even if the meter is replaced.

Supply margins

Referring to the electricity market, it means that supply fundamentals are strong i.e. there is enough supply to meet demand. This scenario can push prices down, but usually only for the next day.

Standing Charge

Is a daily or monthly charge to contribute towards installation, maintenance and administration costs for the local Distribution Network Operator (DNO).


Refers to gas stoage. This can be long term storage facilities (the biggest being rough), or shorter term facilities.

Supply Number

S-Number (also known as MPAN - Meter Point Administration Number). A unique number identifying the distribution company and the location of the metering point.

Surface Water Drainage

Rainwater that falls onto domestic and commercial premises and public highways.  In Scotland, known as "Property" drainage.

Sustainable Urban Drainage Systems (SuDS)

Sustainable Urban Drainage Systems seek to mimic the way that natural features of the landscape allow rain to soak away and so reduce the impact of development on sewerage systems. Examples of man-made SuDS include permeable paving, reed beds, ponds, wetlands, green roofs and water butts. 


Take-or-Pay (ToP)

A form of gas/electricity supply contract which provides that a minimum quantity of gas/electricity in a period of time be paid for, whether or not delivery is accepted by the purchaser. Failure to take this amount still required the buyer to pay for the full contracted volume.

Terawatt (tW)

Electrical unit of power equal to one thousand gigawatts.

Time of Day (ToD)

An energy meter which measures the energy consumed and also the time of day it was consumed.

TH - or Therm

This is the unit used on the gas wholesale market. 70p/th = 2.388p/kW.

Trade Effluent

Any liquid waste that is discharged from premises being used for a business, trade or industry.  Generally refers to anything other than "domestic" concentration of wastewater.

Trading session

A terms for the price at the end of the day. It can be used synonymously with closing price.

Trading upwards

A synonym for bullish. It means that prices are increasing.


The transfer of electricity at high voltage from the power stations across the UK through wires on pylons to points where it can be distributed to users. This is known as the Grid System and is owned and operated by the National Grid Company (NGC).

Transmission Losses (Line Losses)

When transmitting electricity from generator to local distribution network areas some electricity is lost. Specific calculations have to be made by suppliers to determine the level of these losses.

Transmission Network Use of System (TNUoS)

The charges are incurred for transmitting electricity across the National Grid network from the source of generation to the network of the local distribution company. The level of these charges is usually calculated by applying a rate charge to the TRIAD demand level.

Transportation Charge

A charge made by National Grid for the national transport of the shippers’ gas through the gas network (National and Regional Transmission system and the low and medium pressure distribution system) to the customer. The transportation charge consists of three elements, which are dependent on the locations of the particular terminal and offtake site: capacity charge; commodity charge; and site charge.


A TRIAD is used to calculate TNUoS Charges. The TRIAD is calculated by looking at the three maximum demand points (in kW) of the supply at half hourly time periods, and then averaging the total. The figures used are usually selected from winter months, and at peak times, as these periods are set to reflect the point at which the highest demand occurs on the National Grid.



A gradual upward movement.

Unit Price

The price paid per unit of energy used (eg in kilowatt hours). The unit price includes costs such as transportation but excludes standing charges, government taxes such as VAT or the Climate Change Levy, or any other third party costs.

United Kingdom Continental Shelf (UKCS)

United Kingdom Continental Shelf: The region of waters surrounding the United Kingdom, in which the country claims mineral rights. This principally refers to the North Sea, where there are large resources of hydrocarbons.

United Nations Framework Convention on Climate Change

An international environmental treaty negotiated at the Earth Summit in Rio de Janeiro from 3 to 14 June 1992, then entered into force on 21 March 1994.



The force that causes a current to move through some resistance, in this case, the National Grid. In industry terms, electricity moves round the main grid at a high voltage. When it is stepped down to the level of a smaller grid or an actual site it is regarded as low voltage. Low voltage supply is more expensive because of the costly process of stepping it down from high voltage. A number of larger industrial sites take high voltage direct which means they incur the cost of stepping the voltage down. For this, they subsequently receive more competitive pricing.

Volume Conversion Factor

A volume conversion factor for temperature and pressure, which makes allowances for gas pressure and the fact that gas expands as it gets warm and contracts when it is cold.


A measure of the rate of fluctuations in the relevant market price, often referred to as historical volatility.


Water Power

A renewable energy source where energy is generated from a water source, such as hydro-electric, wave or tidal power.

Watt (W)

A unit of electrical measurement equal to one ampere under a pressure of one volt.

Watthour (Wh)

A unit of electrical measurement equal to one watt of power supplied to, or taken from, an electric circuit steadily for one hour.

Weekday Peak Demands

The highest electricity demand expected/observed during each week expected between Monday and Thursday.

Weighted Average Price (WAP)

Market monthly average price multiplied by volumes required by Inprova or each month and divided by total volume to calculate weighted average across the year of delivery. Weighted average reflects requirements for different volumes in months of highest demand.

Wholesaler (in water)

Responsible for collection, processing and delivery of water to customers and for the removal and treatment of wastewater and trade effluent, the wholesaler owns and maintains the infrastructure, pipework and fiscal meters.

Under market reform, the Licensed Retailer is responsible for customer facing activities, such as billing, meter reading and dealing with queries etc. The Retailer is the interface between the customer and the wholesaler. From April 2017 all non-household customers will be able to choose their retailer, but generally not have any choice over their wholesale supplier.

Water Industry Commission for Scotland (WICS)

Water Industry Commission for Scotland. The regulator for water services in Scotland (equivalent to Ofwat in England and Wales)

Water Supply Licensee (WSL)

A Water Supply Licensee is a retailer of water supply only, not including wastewater

Winter Peak Demand

The highest electricity demand expected/observed during the winter.

Water & Sewerage Supply Licensee (WSSL)

Water & Sewerage Supply Licensee (a retailer of all water services)