ENERGY SUPPLIERS
NEWS + KNOWLEDGE
North Shore Energy provides energy consulting and brokering solutions to Commercial & Industrial utility customers in deregulated energy markets. The primary services we provide to our clients are focused on:
Electric Procurement
Over the past two decades, state Public Utility Commissions (PUC) began to deregulate the sale of electricity. While the delivery of electricity to homes & businesses remains the responsibility of the local utility company and continues to be regulated by your state's PUC, the procurement of electricity is now open to competition...
Deregulation FAQ's
North Shore Energy makes benefitting from deregulation easy by answering your questions and showing you how our expertise in deregulated energy markets, combined with our extensive list of energy suppliers, can help you control your costs....
Natural Gas Procurement
North Shore Energy can help your business achieve cost savings & budget certainty due to the deregulation of natural gas. As an independent energy broker, our obligation is to you - the client. Since we are not affiliated with utilities or suppliers, we are not obligated to any one company, which allows us to create competition among suppliers to serve your natural gas needs...
Click below for a Glossary of Terms specific to the energy industry.
Energy HQ
Your Energy HQ is more than a name. You decide the services you want to create more value for your organization. We offer a range of programs & services - all expertly managed by our experienced energy team. Learn how how PLC Reduction & Peak Alert Services can reduce your capacity costs. Or how Demand Response pays you to reduce usage during times of peak demand. Or how real-time metering can optimize & streamline your operations...
If you’re not sure if you operate in a deregulated utility zone, refer to the following map below for a high level overview:
Over the past two decades, State Public Utility Commissions (PUC) began to deregulate the sale of electricity. While the delivery of electricity to homes and businesses remains the responsibility of the local utility company and continues to be regulated by your State’s PUC, the procurement of electricity is now open to competition.
This is where North Shore Energy comes in. We maintain relationships with numerous regional and national energy suppliers to help you procure energy at the most competitive prices. Our team of experienced Energy Consultants will help you decide which electricity supplier can best meet your needs based on criteria such as: price, contract terms & conditions, load requirements, and upcoming changes in the regulatory environment.
We will also help you determine the the best fit electric product design that will be most cost-effective for your business, while matching your risk tolerance. Electric product design can be tailored to your exact needs, but the basic components are:
North Shore Energy can help your business achieve cost savings and budget certainty due to the deregulation of natural gas. As an independent energy broker, our obligation is to you, the client. Since we are not affiliated with utilities or suppliers, we are not obligated to any one company – allowing us to create competition among suppliers to serve your natural gas needs.
When you work with North Shore Energy, we will let you know when and where market opportunities exist to purchase your natural gas. We will seek bids from all eligible suppliers, and present you with a simplified apples-to-apples comparison of all offers, ensuring complete price offer transparency. Our objective throughout the process is to provide you the support and expertise you need to secure your contract at the right time, with the best possible price and terms.
With our knowledge and relationships with numerous suppliers in the gas industry, we are serving hundreds of natural gas accounts for our clients. Our account managers can help you negotiate your next supply agreement, which might include:
Standard fixed-price
NYMEX-plus
We will begin by gathering data about your facility, analyzing your gas load, market conditions, and helping you develop a custom procurement strategy that works best for your business.
Think of Energy HQ as your personal energy trainer. NSE's team of energy experts will guide you through exercises & services that can improve operations and ultimately reduce costs. Don't see something listed here that you need? Chances are we do it. Just ask.
Peak Load Contribution (PLC) Reduction
Your Peak Load Contribution (PLC) is simply your company's contribution to the electricity grid's peak demand during the 5 highest demand days June 1 - September 30th of each year. Every customer is assigned a Peak Load Contribution by their local utility, which averages your electrical load during these 5 peak load hours. Your PLC is then used to calculate the 2nd largest component of your electricity price - capacity. By reducing your consumption during these 5 peak demand hours, your PLC will decrease starting June 1 of the next year, thus lowering your capacity costs. We have many services that monitor and track these demand days (below):
Peak Alert Service
NSE's Peak Alert Service provides you with weekly forecasts of when a peak day might occur, in addition to sending appropriate warning & action alerts for reducing your electricity load during times of peak demand on the electricity grid. We can tailor our alerts to you in a way that works best with your company (texts, emails, phone calls, etc).
Real-time Metering
NSE's Real-Time Metering service assists with the installation of a meter that tracks your energy consumption in real time. No more wondering what's using the bulk of your electricity or which building is most inefficient. Our meters will optimize your operations and help you reduce your load during times of peak demand. Real-time metering literally takes the guesswork out of your energy consumption.
Demand Response (DR) is a voluntary program where customers are compensated to be on stand-by to reduce power usage when the grid is under heavy load in order to prevent brownouts & blackouts. During times of heavy load across the entire grid, which typically occur during the three summer months, commercial & industrial customers can help maintain grid reliability by volunteering to reduce their electrical load.
Through this program, you will receive quarterly capacity payments simply for being on call, ready to respond to demand response events. These payments depend on the amount of energy your facility can reduce and are earned regardless of whether an event is called. You will also receive energy payments for your performance during events. Any customers who can reduce their load by 200 kW or more should consider participating in the program. Because DR is a voluntary program, you retain the control over whether or not you participate when an emergency event is called.
For more information on Demand Response programs, or for help understanding the impact Capacity Costs will have on your organization in the coming years, please contact North Shore Energy for a complimentary consultation.
Deregulation Frequently Asked Questions
Deregulated energy markets throughout the United States can mean substantial cost savings for businesses aware of the opportunities. North Shore Energy makes benefiting from deregulation easy by answering your questions and showing you how our expertise in deregulated energy markets, combines with our extensive list of energy suppliers, can help you control your costs.
Q: Will the reliability of my electric or natural gas service change with deregulation?
A: No. Regardless of which energy provider we help you choose, your electricity and natural gas will continue to be delivered safely and reliably by the local utility company, a company still regulated by the Public Utility Commission.
Q: What happens if I have an emergency or power outage?
A: Because your local wires company is still responsible for the maintenance and repair of the poles and wires, you will call them in the event of an emergency or outage at the number provided on your bill.
Q: What has stayed the same in electric and natural gas service with deregulation?
A: Your current Transmission and Distribution Utility, continues to deliver electricity and natural gas to your business. Your local utility company still responds to service interruptions and continues to maintain the poles, wires and pipelines. You will continue to receive the same reliable service you are used to with your local utility company, regardless of which energy provider you receive service from. It’s helpful to think of electricity and natural gas deregulation like the deregulation that occurred several years ago in the long-distance telephone service market. Consumers now have the power to choose the long-distance carrier of their own liking. However, regardless of which long-distance carrier they choose, their phone lines are still provided and serviced by the same local phone company.
Q: What has changed in electric and natural gas service with deregulation?
A: You can now choose to buy your energy from a different provider than the original provider for your area. These companies are called retail energy providers. Additionally, your bill now looks different than bills you have received in the past, but each retail energy provider provides the same standard information.
Q: Does everyone have the option to choose a new electricity or natural gas provider?
A: Unfortunately not. City-owned utilities and member-owned electric cooperatives have the option of giving their customers a choice of providers, or keeping things the same.
Q: Why use an energy procurement advisor?
A: The answer is simple: we save you time and money. Staying in-tune daily with energy markets, providers and new opportunities is a full-time job. With North Shore Energy you can capitalize on the benefits offered by deregulation without committing significant time and resources to understanding the complexity of the markets. We get to know your business and your specific energy needs. Then we negotiate with energy providers on your behalf to get the best rates and options. After you have an agreement with a provider, we continue to service your business, and in case your needs change we are there to renegotiate new agreements that fit those needs. We do all the work. You receive all the benefits.
Q: Will I notice a change of service when I switch my energy provider?
A: No. No matter which energy provider you choose, your energy will continue to be delivered safely and reliably by the local utility company, a company still regulated by the Public Utility Commission.
Q: What happens if my energy provider stops serving customers?
A: If this were to take place, you would not be without energy. Your energy provider must give you advance notice to give you time to select a new provider. However, if you do not choose a new energy provider, your service will automatically be switched to another provider for your area. In this case, your energy rate may increase, so it’s in your best interest to find a new provider if yours stops serving you.
Aggregator: Any marketer, broker, public agency, city, county, or special district that combines the loads of multiple end-use customers in facilitating the sale and purchase of electric energy, transmission, and other services on behalf of these customers.
Ampere: The unit of measurement of electrical current produced in a circuit by 1 volt acting through a resistance of 1 ohm.
Ancillary Services: Necessary services that must be provided in the generation and delivery of electricity. As defined by the Federal Energy Regulatory Commission, they include:* coordination and scheduling services (load following, energy imbalance service, control of transmission congestion); automatic generation control (load frequency control and the economic dispatch of plants); contractual agreements (loss compensation service); and support of system integrity and security (reactive power, or spinning and operating reserves).
Baseload: The minimum amount of electric power delivered or required over a given period of time at a steady rate.
Baseload Capacity: The generating equipment normally operated to serve loads on an around-the-clock basis.
Bcf: The abbreviation for 1 billion cubic feet.
Bilateral Agreement: Written statement signed by a pair of communicating parties that specifies what data may be exchanged between them.
Bilateral Contract: A direct contract between the power producer and user or broker outside of a centralized power pool or power exchange.
Broker: An entity that arranges the sale and purchase of electric energy, transmission, and other services between buyers and sellers, but does not take title to any of the power sold.
Btu: (British Thermal Unit) A standard unit for measuring the quantity of heat energy equal to the quantity of heat required to raise the temperature of 1 pound of water by 1 degree Fahrenheit.
Bundled Utility Service: All generation, transmission, and distribution services provided by one entity for a single charge. This would include ancillary services and retail services.
Capacity: The amount of electric power delivered or required for which a generator, turbine, transformer, transmission circuit, station, or system is rated by the manufacturer.
Capacity Charge: An element in a two-part pricing method used in capacity transactions (energy charge is the other element). The capacity charge, sometimes called Demand Charge, is assessed on the amount of capacity being purchased.
Circuit: A conductor or a system of conductors through which electric current flows.
Co-generator: A generating facility that produces electricity and another form of useful thermal energy (such as heat or steam), used for industrial, commercial, heating, or cooling purposes.
Combined Cycle: An electric generating technology in which electricity is produced from otherwise lost waste heat exiting from one or more gas (combustion) turbines. The exiting heat is routed to a conventional boiler or to a heat recovery steam generator for utilization by a steam turbine in the production of electricity. This process increases the efficiency of the electric generating unit.
Commercial Customer: The commercial sector is generally defined as non-manufacturing business establishments, including hotels, motels, restaurants, wholesale businesses, retail stores, and health, social, and educational institutions. The utility may classify commercial service as all consumers whose demand or annual use exceeds some specified limit. The limit may be set by the utility based on the rate schedule of the utility.
Competitive Power Supplier: A competitive power supplier (also known as an electricity supplier, power producer, power generator, power seller, power marketer or power broker) is a company or group that sells electricity.
Competitive Transition Charge: A non-by passable charge levied on each customer of a distribution utility, including those who are served under contracts with non-utility suppliers, for recovery of a utility’s transition costs.
Congestion: A condition that occurs when insufficient transfer capacity is available to implement all of the preferred schedules for electricity transmission simultaneously. Consumer Choice: Allowing all customers to purchase kilowatthours of electricity from any of a number of companies that compete with each other.
Consumption (Fuel): The amount of fuel used for gross generation, providing standby service, start-up and/or flame stabilization.
Contract Price: Price of fuels marketed on a contract basis covering a period of 1 or more years. Contract prices reflect market conditions at the time the contract was negotiated and therefore remain constant throughout the life of the contract or are adjusted through escalation clauses. Generally, contract prices do not fluctuate widely.
Current: A flow of electrons in an electrical conductor. The strength or rate of movement of the electricity is measured in amperes.
Day-Ahead Market: The forward market for energy and ancillary services to be supplied during the settlement period of a particular trading day that is conducted by the applicable Independent System Operator, the power exchange, and other Scheduling Coordinators. This market closes with the Independent System Operator’s acceptance of the final day-ahead schedule.
Day-Ahead Schedule: A schedule prepared by a Scheduling Coordinator or the Independent System Operator before the beginning of a trading day. This schedule indicates the levels of generation and demand scheduled for each settlement period that trading day.
Demand: The rate at which energy is delivered to loads and scheduling points by generation, transmission, and distribution facilities.
Demand: The rate at which electric energy is delivered to or by a system, part of a system, or piece of equipment, at a given instant or averaged over any designated period of time.
Demand Bid: A bid into the power exchange indicating a quantity of energy or an ancillary service that an eligible customer is willing to purchase and, if relevant, the maximum price that the customer is willing to pay.
Demand-Side Management: The planning, implementation, and monitoring of utility activities designed to encourage consumers to modify patterns of electricity usage, including the timing and level of electricity demand. It refers only to energy and load-shape modifying activities that are undertaken in response to utility-administered programs. It does not refer to energy and load-shape changes arising from the normal operation of the marketplace or from government-mandated energy-efficiency standards. Demand-Side Management (DSM) covers the complete range of load-shape objectives, including strategic conservation and load management, as well as strategic load growth.
Deregulation: The elimination of regulation from a previously regulated industry or sector of an industry.
Direct Access: The ability of a retail customer to purchase commodity electricity directly from the wholesale market rather than through a local distribution utility.
Disclosure Label: A disclosure label is a standard format of information detailing a competitive power supplier’s prices, the terms of their contract with a customer, the types of power sources used, their air emissions and their labor practices. The same format is to be used by every supplier and distribution company, making it easier to compare the various offers.
Distribution Company: A distribution company, formerly known as an electric utility company, is the local company that delivers electricity to your home or business. Your distribution company will continue to read your meter, maintain local wires and poles, and restore your power in the event of an outage.
Distribution System: The portion of an electric system that is dedicated to delivering electric energy to an end user.
Electricity Facts Label: An information sheet required by the Texas PUC that provides customers with standardized information on a Retail Electric Provider’s prices, contracts, sources of power generation and emissions. It allows customers to make an “apples-to-apples” comparison of Retail Electric Provider offers.
Electric Plant: A facility containing prime movers, electric generators, and auxiliary equipment for converting mechanical, chemical, and/or fission energy into electric energy.
Electric Rate Schedule: A statement of the electric rate and the terms and conditions governing its application, including attendant contract terms and conditions that have been accepted by a regulatory body with appropriate oversight authority.
Electric Service Provider: An entity that provides electric service to a retail or end-use customer.
Electric Utility: A corporation, person, agency, authority, or other legal entity or instrumentality that owns and/or operates facilities within the United States, its territories, or Puerto Rico for the generation, transmission, distribution, or sale of electric energy primarily for use by the public and files forms listed in the Code of Federal Regulations, Title 18, Part 141. Facilities that qualify as cogenerators or small power producers under the Public Utility Regulatory Policies Act (PURPA) are not considered electric utilities.
Energy: The capacity for doing work as measured by the capability of doing work (potential energy) or the conversion of this capability to motion (kinetic energy). Energy has several forms, some of which are easily convertible and can be changed to another form useful for work. Most of the world’s convertible energy comes from fossil fuels that are burned to produce heat that is then used as a transfer medium to mechanical or other means in order to accomplish tasks. Electrical energy is usually measured in kilowatt hours, while heat energy is usually measured in British thermal units.
Energy Charge: That portion of the charge for electric service based upon the electric energy (kWh) consumed or billed.
Energy Efficiency: Refers to programs that are aimed at reducing the energy used by specific end-use devices and systems, typically without affecting the services provided. These programs reduce overall electricity consumption (reported in megawatthours), often without explicit consideration for the timing of program-induced savings. Such savings are generally achieved by substituting technically more advanced equipment to produce the same level of end-use services (e.g. lighting, heating, motor drive) with less electricity. Examples include high-efficiency appliances, efficient lighting programs, high-efficiency heating, ventilating and air conditioning (HVAC) systems or control modifications, efficient building design, advanced electric motor drives, and heat recovery systems.
Energy Source: The primary source that provides the power that is converted to electricity through chemical, mechanical, or other means. Energy sources include coal, petroleum and petroleum products, gas, water, uranium, wind, sunlight, geothermal, and other sources.
Federal Energy Regulatory Commission (FERC): A quasi-independent regulatory agency within the Department of Energy having jurisdiction over interstate electricity sales, wholesale electric rates, hydroelectric licensing, natural gas pricing, oil pipeline rates, and gas pipeline certification.
Federal Power Act: Enacted in 1920, and amended in 1935, the Act consists of three parts. The first part incorporated the Federal Water Power Act administered by the former Federal Power Commission, whose activities were confined almost entirely to licensing non-Federal hydroelectric projects. Parts II and III were added with the passage of the Public Utility Act. These parts extended the Act’s jurisdiction to include regulating the interstate transmission of electrical energy and rates for its sale as wholesale in interstate commerce. The Federal Energy Regulatory Commission is now charged with the administration of this law.
Federal Power Commission: The predecessor agency of the Federal Energy Regulatory Commission. The Federal Power Commission (FPC) was created by an Act of Congress under the Federal Water Power Act on June 10, 1920. It was charged originally with regulating the electric power and natural gas industries. The FPCwas abolished on September 20, 1977, when the Department of Energy was created. The functions of the FPC were divided between the Department of Energy and the Federal Energy Regulatory Commission.
Firm Gas: Gas sold on a continuous and generally long-term contract.
Firm Power: Power or power-producing capacity intended to be available at all times during the period covered by a guaranteed commitment to deliver, even under adverse conditions.
Forced Outage: The shutdown of a generating unit, transmission line or other facility, for emergency reasons or a condition in which the generating equipment is unavailable for load due to unanticipated breakdown.
Fuel: Any substance that can be burned to produce heat; also, materials that can be fissioned in a chain reaction to produce heat.
Fuel Factor: An Affiliate Retail Electric Provider is allowed to recover its costs for the fuel used to generate electricity, such as coal, natural gas, wind, water, nuclear, etc., through the fuel factor. In Texas, this cost is set by the Public Utility Commission and charged on each customer’s bill, based on kilowatt-hour (kWh) usage. An Affiliate Retail Electric Provider is prohibited from making a profit on fuel costs.
Futures Market: Arrangement through a contract for the delivery of a commodity at a future time and at a price specified at the time of purchase. The price is based on an auction or market basis. This is a standardized, exchange-traded, and government regulated hedging mechanism.
Gas: A fuel burned under boilers and by internal combustion engines for electric generation. These include natural, manufactured and waste gas.
Gas Turbine Plant: A plant in which the prime mover is a gas turbine. A gas turbine consists typically of an axial-flow air compressor, one or more combustion chambers, where liquid or gaseous fuel is burned and the hot gases are passed to the turbine and where the hot gases expand to drive the generator and are then used to run the compressor.
Generating Unit: Any combination of physically connected generator(s), reactor(s), boiler(s), combustion turbine(s), or other prime mover(s) operated together to produce electric power.
Generation: The process of producing electric energy by transforming other forms of energy; also, the amount of electric energy produced, expressed in watthours (Wh).
Generation Company: A regulated or non-regulated entity (depending upon the industry structure) that operates and maintains existing generating plants. The generation company may own the generation plants or interact with the short-term market on behalf of plant owners. In the context of restructuring the market for electricity, the generation company is sometimes used to describe a specialized “marketer” for the generating plants formerly owned by a vertically-integrated utility.
Generator: A machine that converts mechanical energy into electrical energy.
Generator Nameplate Capacity: The full-load continuous rating of a generator, prime mover, or other electric power production equipment under specific conditions as designated by the manufacturer. Installed generator nameplate rating is usually indicated on a nameplate physically attached to the generator.
Gigawatt (GW): One billion watts. Gigawatthour (GWh): One billion watthours.
Grid: The layout of an electrical distribution system.
Headroom: The customer specific default UDC commodity charge. It serves as the “maximum, economically feasible, commodity rate a third party supplier would charge said customer”.
Hedging Contracts: Contracts which establish future prices and quantities of electricity independent of the short-term market. Derivatives may be used for this purpose.
ICAP: Installed Capacity Independent Power
Independent System Operators: An independent, Federally-regulated entity that coordinates regional transmission in a non-discriminatory manner and ensures the safety and reliability of the electric system.
Industrial: The industrial sector is generally defined as manufacturing, construction, mining agriculture, fishing and forestry establishments Standard Industrial Classification (SIC) codes 01-39. The utility may classify industrial service using the SIC codes, or based on demand or annual usage exceeding some specified limit. The limit may be set by the utility based on the rate schedule of the utility.
Intermediate Load: The range from base load to a point between base load and peak. This point may be the midpoint, a percent of the peakload, or the load over a specified time period.
Interruptible Load: Refers to program activities that, in accordance with contractual arrangements, can interrupt consumer load at times of seasonal peak load by direct control of the utility system operator or by action of the consumer at the direct request of the system operator. It usually involves commercial and industrial consumers. In some instances the load reduction may be affected by direct action of the system operator (remote tripping) after notice to the consumer in accordance with contractual provisions. For example, loads that can be interrupted to fulfill planning or operation reserve requirements should be reported as Interruptible Load.
Investor-Owned Utility: A class of utility whose stock is publicly traded and which is organized as a tax-paying business, usually financed by the sale of securities in the capital market. It is regulated and authorized to achieve an allowed rate of return.
Kilowatt (kW): One thousand watts. Kilowatthour (kWh): A kilowatt-hour (kWh) is the standard unit of measure for electricity. One kilowatt-hour is equal to 1,000 watt-hours. The total number of kilowatt-hours charged to your bill is determined by your electricity use.
Load (Electric): The amount of electric power delivered or required at any specific point or points on a system. The requirement originates at the energy-consuming equipment of the consumers.
Market-Based Pricing: Electric service prices determined in an open market system of supply and demand under which the price is set solely by agreement as to what a buyer will pay and a seller will accept. Such prices could recover less or more than full costs, depending upon what the buyer and seller see as their relevant opportunities and risks.
Market Clearing Price: The price at which supply equals demand for the Day Ahead and/or Hour Ahead Markets.
Maximum Demand: The greatest of all demands of the load that has occurred within a specified period of time.
Mcf: One thousand cubic feet.
Megawatt (MW): One million watts. 1 MW = 1,000 kW.
Megawatthour (MWh): One million watthours. 1 MWh = 1,000 kWh.
MMcf: One million cubic feet.
Municipal Utility: A municipal utility is a non-profit utility that is owned and operated by the community it serves. Whether or not a municipal utility is open to customer choice and competition is decided by the municipality’s public officials.
Natural Gas: A naturally occurring mixture of hydrocarbon and nonhydrocarbon gases found in porous geological formations beneath the earth’s surface, often in association with petroleum. The principal constituent is methane.
NERC: North American Electric Reliability Council
Non-Firm Power: Power or power-producing capacity supplied or available under a commitment having limited or no assured availability.
Nuclear Power Plant: A facility in which heat produced in a reactor by the fissioning of nuclear fuel is used to drive a steam turbine.
OASIS: Open Access Same-time Information System. Clearing house for all market based data.
OATT: Open Access Transmission Tariff. Applicable tariff for all suppliers, documents charges.
Off-Peak Gas: Gas that is to be delivered and taken on demand when demand is not at its peak.
Ohm: The unit of measurement of electrical resistance. The resistance of a circuit in which a potential difference of 1 volt produces a current of 1 ampere.
Open Access: A regulatory mandate to allow others to use a utility’s transmission and distribution facilities to move bulk power from one point to another on a nondiscriminatory basis for a cost-based fee.
Outage: The period during which a generating unit, transmission line, or other facility is out of service.
Peak Demand: The highest 15- or 30-minute demand recorded during a 12-month period.
Peaking Capacity: Capacity of generating equipment normally reserved for operation during the hours of highest daily, weekly, or seasonal loads. Some generating equipment may be operated at certain times as peaking capacity and at other times to serve loads on an around-the-clock basis.
Petroleum: A mixture of hydrocarbons existing in the liquid state found in natural underground reservoirs, often associated with gas. Petroleum includes fuel oil No. 2, No. 4, No. 5, No. 6; topped crude; Kerosene; and jet fuel.
Petroleum: A naturally occurring, oily, flammable liquid composed principally of hydrocarbons. Crude oil is occasionally found in springs or pools but usually is drilled from wells beneath the earth’s surface.
Planned Generator: A proposal by a company to install electric generating equipment at an existing or planned facility or site. The proposal is based on the owner having obtained (1) all environmental and regulatory approvals, (2) a signed contract for the electric energy, or (3) financial closure for the facility.
Power: The rate at which energy is transferred. Electrical energy is usually measured in watts. Also used for a measurement of capacity.
Power Exchange: The entity that will establish a competitive spot market for electric power through day- and/or hour-ahead auction of generation and demand bids.
Power Exchange Load: Load that has been scheduled by the power exchange and which is received through the use of transmission or distribution facilities owned by participating transmission owners.
Power Marketers: Business entities engaged in buying, selling, and marketing electricity. Power marketers do not usually own generating or transmission facilities. Power marketers, as opposed to brokers, take ownership of the electricity and are involved in interstate trade. These entities file with the Federal Energy Regulatory Commission for status as a power marketer.
Power Pool: An association of two or more interconnected electric systems having an agreement to coordinate operations and planning for improved reliability and efficiencies.
Price: The amount of money or consideration-in-kind for which a service is bought, sold, or offered for sale.
Pricing Options: Among the different competitive power suppliers there are several types of pricing options being offered. Some may charge the same price for every kilowatt-hour of electricity that you use; whereas others will charge different rates depending on the time of consumption or the amount consumed.
Producers: Entities that are also considered nonutility power producers in the United States. These facilities are wholesale electricity producers that operate within the franchised service territories of host utilities and are usually authorized to sell at market-based rates. Unlike traditional electric utilities, Independent Power Producers do not possess transmission facilities or sell electricity in the retail market.
Provider of Last Resort: The Provider of Last Resort serves as the “back-up” provider when a Retail Electric Provider leaves the market for any reason.
Public Aggregator: A public aggregator is an organization established by a city, town, or county to purchase electricity in bulk for its citizens in order to increase their buying power. Participation is voluntary; consumers can opt-out if they choose and return to the standard offer service within 180 days.
Regional Transmission Group: A utility industry concept that the Federal Energy Regulatory Commission embraced for the certification of voluntary groups that would be responsible for transmission planning and use on a regional basis.
Regulation: The governmental function of controlling or directing economic entities through the process of rulemaking and adjudication.
Reliability: Electric system reliability has two components—adequacy and security. Adequacy is the ability of the electric system to supply to aggregate electrical demand and energy requirements of the customers at all times, taking into account scheduled and unscheduled outages of system facilities. Security is the ability of the electric system to withstand sudden disturbances, such as electric short circuits or unanticipated loss of system facilities. The degree of reliability may be measured by the frequency, duration, and magnitude of adverse effects on consumer services.
Renewable Resources: Naturally, but flow-limited resources that can be replenished. They are virtually inexhaustible in duration but limited in the amount of energy that is available per unit of time. Some (such as geothermal and biomass) may be stock-limited in that stocks are depleted by use, but on a time scale of decades, or perhaps centuries, they can probably be replenished. Renewable energy resources include:* biomass, hydro, geothermal, solar and wind. In the future, they could also include the use of ocean thermal, wave, and tidal action technologies. Utility renewable resource applications include bulk electricity generation, on-site electricity generation, distributed electricity generation, non-grid-connected generation, and demand-reduction (energy efficiency) technologies.
Re-regulation: The design and implementation of regulatory practices to be applied to the remaining regulated entities after restructuring of the vertically-integrated electric utility. The remaining regulated entities would be those that continue to exhibit characteristics of a natural monopoly, where imperfections in the market prevent the realization of more competitive results, and where, in light of other policy considerations, competitive results are unsatisfactory in one or more respects. Regulation could employ the same or different regulatory practices as those used before restructuring.
Reserve Margin: The amount of unused available capability of an electric power system at peakload for a utility system as a percentage of total capability.
Residential: The residential sector is defined as private household establishments which consume energy primarily for space heating, water heating, air conditioning, lighting, refrigeration, cooking and clothes drying. The classification of an individual consumer’s account, where the use is both residential and commercial, is based on principal use. For the residential class, do not duplicate consumer accounts due to multiple metering for special services (water, heating, etc.). Apartment houses are also included.
Restructuring: The process of replacing a monopoly system of electric utilities with competing sellers, allowing individual retail customers to choose their electricity supplier but still receive delivery over the power lines of the local utility. It includes the reconfiguration of the vertically-integrated electric utility.
Retail: Sales covering electrical energy supplied for residential, commercial, and industrial end-use purposes. Other small classes, such as agriculture and street lighting, also are included in this category.
Retail Competition: The concept under which multiple sellers of electric power can sell directly to end-use customers and the process and responsibilities necessary to make it occur.
Retail Market: A market in which electricity and other energy services are sold directly to the end-use customer.
Retail Wheeling: The process of moving electric power from a point of generation across one or more utility-owned transmission and distribution systems to a retail customer.
Running and Quick-Start Capability: The net capability of generating units that carry load or have quick-start capability. In general, quick-start capability refers to generating units that can be available for load within a 30-minute period.
Scheduling Coordinators: Entities certified by the Federal Energy Regulatory Commission that act as a go-between with the Independent System Operator on behalf of generators, supply aggregators (wholesale marketers), retailers, and customers to schedule the distribution of electricity.
Scheduled Outage: The shutdown of a generating unit, transmission line, or other facility, for inspection or maintenance, in accordance with an advance schedule.
Securitization: A proposal for issuing bonds that would be used to buy down existing power contracts or other obligations. The bonds would be repaid by designating a portion of future customer bill payments. Customer bills would be lowered, since the cost of bond payments would be less than the power contract costs that would be avoided.
Securitize: The aggregation of contracts for the purchase of the power output from various energy projects into one pool which then offers shares for sale in the investment market. This strategy diversifies project risks from what they would be if each project were financed individually, thereby reducing the cost of financing. Fannie Mae performs such a function in the home mortgage market.
Spinning Reserve: That reserve generating capacity running at a zero load and synchronized to the electric system.
Spot Purchases: A single shipment of fuel or volumes of fuel, purchased for delivery within 1 year. Spot purchases are often made by a user to fulfill a certain portion of energy requirements, to meet unanticipated energy needs, or to take advantage of low-fuel prices.
Steam-Electric Plant: A conventional electric plant in which the prime mover is a steam turbine. The steam used to drive the turbine is produced in a boiler where fossil fuels are burned.
Standard Offer Service: A transition generation service that will be available to customers of record of each Distribution Company through 2004. A customer that did not select a competitive supplier as of March 1, 1998 automatically was placed on Standard Offer Service (customers who move into a Distribution Company’s service territory after March 1, 1998 are not eligible to receive Standard Offer – these customers are placed on Default Service until they select a competitive supplier).
Stranded Costs: Prudent costs incurred by a utility which may not be recoverable under market-based retail competition. Examples are undepreciated generating facilities, deferred costs, and long-term contract costs.
System: Physically connected electric generation, transmission, and distribution facilities operated as an integrated unit under one central management, or operating supervision.
Transformer: An electrical device for changing the voltage of alternating current.
Transition Charge: The transition charge, also known as stranded costs, are the costs of past utility investments including power plants and power contracts. These charges were included in electric rates before competition. Because these costs cannot be fully recovered in a competitive market, stranded costs are temporary expenses that are included in the transition charge on your electric bill. These charges will be reduced over time.
Transmission: The movement or transfer of electric energy (at high voltage levels) over an interconnected group of lines and associated equipment between points of supply and points at which it is transformed for delivery to consumers, or is delivered to other electric systems. Transmission is considered to end when the energy is transformed for distribution to the consumer. This portion of the electric utility industry has not been opened to competition and will continue to be regulated by state and federal government.
Transmission System: An interconnected group of electric transmission lines and associated equipment for moving or transferring electric energy in bulk between points of supply and points at which it is transformed for delivery over the distribution system lines to consumers, or is delivered to other electric systems.
Turbine: A machine for generating rotary mechanical power from the energy of a stream of fluid (such as water, steam, or hot gas). Turbines convert the kinetic energy of fluids to mechanical energy through the principles of impulse and reaction, or a mixture of the two.
UCAP (Unforced Capacity): The measurement used to determine if a Participant has met their contribution to it’s Installed Capacity Requirement.
UDC: Utility Distribution Company Unbundling: The separating of the total process of electric power service from generation to metering into its component parts for the purpose of separate pricing or service offerings.
Usage: This is the amount of electricity you used during the billing period listed in kilowatt-hours (kWh). This will be listed on your electric bill as kWh used.
Utility Distribution Companies: The entities that will continue to provide regulated services for the distribution of electricity to customers and serve customers who do not choose direct access. Regardless of where a consumer chooses to purchase power, the customer’s current utility, also known as the utility distribution company, will deliver the power to the consumer’s home, business, or farm.
Vertical Integration: An arrangement whereby the same company owns all the different aspects of making, selling, and delivering a product or service. In the electric industry, it refers to the historically common arrangement whereby a utility would own its own generating plants, transmission system, and distribution lines to provide all aspects of electric service.
Voltage Reduction: Any intentional reduction of system voltage by 3 percent or greater for reasons of maintaining the continuity of service of the bulk electric power supply system.
Volumetric Wires Charge: A type of charge for using the transmission and/or distribution system that is based on the volume of electricity that is transmitted.
Watt: The electrical unit of power. The rate of energy transfer equivalent to 1 ampere flowing under a pressure of 1 volt at unity power factor.
Watthour (Wh): An electrical energy unit of measure equal to 1 watt of power supplied to, or taken from, an electric circuit steadily for 1 hour.
Wheeling Service: The movement of electricity from one system to another over transmission facilities of intervening systems. Wheeling service contracts can be established between two or more systems.
Wholesale Competition: A system whereby a distributor of power would have the option to buy its power from a variety of power producers, and the power producers would be able to compete to sell their power to a variety of distribution companies.
Wholesale Sales: Energy supplied to other electric utilities, cooperatives, municipals, and Federal and State electric agencies for resale to ultimate consumers.
Wholesale Power Market: The purchase and sale of electricity from generators to resellers (who sell to retail customers), along with the ancillary services needed to maintain reliability and power quality at the transmission level.
Wholesale Transmission Services: The transmission of electric energy sold, or to be sold, at wholesale in interstate commerce. Wires Charge: A broad term which refers to charges levied on power suppliers or their customers for the use of the transmission or distribution wires.
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