Glossary Energy

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A

AC
Alternating Current

Acid rain
Forms of precipitation (such as rain, snow or sleet) containing high levels of sulphuric or nitric acids (with pH levels below 5.5-5.6). Also includes dry deposited gases and particles that fall back to earth from the atmosphere. According to the US Environmental Protection Agency, approximately two-thirds of all SO2 and one-quarter of all NOx in the US come from electric power generation that burns fossil fuels such as coal.

Active power
The component of electric power that performs work, typically measured in kilowatts (kW) or megawatts (MW). Also known as “real power.” The terms “active” or “real” are used to modify the base term “power” to differentiate it from Reactive Power.

Actual peak day
The day during which the greatest demand occurs in a one-year period.

Actual peak reduction
The actual reduction in annual peak load (measured in kilowatts) achieved by customers that participate in a utility demand-side management (DSM) program. It reflects the changes in the demand for electricity resulting from a utility DSM program that is in effect at the same time the utility experiences its annual peak load, as opposed to the installed peak load reduction capability (i.e., potential peak reduction). It should account for the regular cycling of energy efficient units during the period of annual peak load.

Actuals
The physical commodity underlying a futures contract. Also referred to as the cash commodity or the physicals.

Adequacy (electric)
The ability of the electric system to supply the aggregate electrical demand and energy requirements of the end-use customers at all times, taking into account scheduled and reasonably expected unscheduled outages of system elements.

Adjusted electricity
A measurement of electricity that includes the approximate amount of energy used to generate electricity. To approximate the adjusted amount of electricity, the site-value of the electricity is multiplied by a factor of 3. This conversion factor of 3 is a rough approximation of the Btu value of raw fuels used to generate electricity in a steam-generation power plant.

Advance royalty
A royalty required to be paid in advance of production from a mineral property that may or may not be recoverable from future production.

Adverse Weather Conditions
Reduced stream flow, lack of rain in the drainage basin, or low water supply behind a pondage or reservoir dam resulting in a reduced gross head that limits the production of hydroelectric power or forces restrictions to be placed on multipurpose reservoirs or other water uses.

Affiliate
An entity which is directly or indirectly owned, operated, or controlled by another entity.

Afforestation
Planting of new forests on lands that have not been recently forested.

Agglomerating character
Agglomeration describes the caking properties of coal. Agglomerating character is determined by examination and testing of the residue when a small powdered sample is heated to 950 degrees Centigrade under specific conditions. If the sample is “agglomerating,” the residue will be coherent, show swelling or cell structure, and be capable of supporting a 500-gram weight without pulverizing.

Aggregate ratio
The ratio of two population aggregates (totals). For example, the aggregate expenditures per household is the ratio of the total expenditures in each category to the total number of households in the category.

Aggregator
Any marketer, broker, public agency, city, county, or special district that combines the loads of multiple end-use customers in negotiating the purchase of electricity, the transmission of electricity, and other related services for these customers.

Agriculture
An energy-consuming subsector of the industrial sector that consists of all facilities and equipment engaged in growing crops and raising animals.

Agriculture, mining, and construction
Companies engaged in agriculture, mining (other than coal mining), or construction industries.

Air pollution abatement equipment
Equipment used to reduce or eliminate airborne pollutants, including particulate matter (dust, smoke, fly, ash, dirt, etc.), sulfur oxides, nitrogen oxides (NOx), carbon monoxide, hydrocarbons, odors, and other pollutants. Examples of air pollution abatement structures and equipment include flue-gas particulate collectors, flue-gas desulfurization units and nitrogen oxide control devices.

Alkylate
The product of an alkylation reaction. It usually refers to the high-octane product from alkylation units. This alkylate is used in blending high octane gasoline.

Alkylation
A refining process for chemically combining isobutane with olefin hydrocarbons (e.g., propylene, butylene) through the control of temperature and pressure in the presence of anacid catalyst, usually sulfuric acid or hydrofluoric acid. The product alkylate, an isoparaffin, has high octane value and is blended with motor and aviation gasoline to improve the antiknock value of the fuel.

Alternating current (AC)
An electric current that reverses its direction at regularly recurring intervals.

Alternative Delivery Procedure (ADP)

A provision of a futures contract that allows buyers and sellers to make and take delivery under terms or  conditions that differ from those prescribed in the contract. An ADP may occur at any time during the delivery period, once long and short futures positions have been matched for the purpose of delivery.

American Indian Coal Lease
A lease granted to a mining company to produce coal from land held in trust by the United States for Native Americans, Native American tribes, and Alaska Natives in exchange for royalties and other revenues.

American Petroleum Institute (API)

The trade association of the US petroleum industry. The API published weekly information on US petroleum stock figures, refinery throughput, imports, exports and stock levels. This information is divided into five geographical areas known as Petroleum Administration for Defence Districts. The API established the system for grading crude oils by specific gravity (API gravity).

AMI
Advanced Metering Infrastructure is a term denoting electricity meters that measure and record usage data at a minimum, in hourly intervals, and provide usage data to both consumers and energy companies at least once daily.

Amortization
The depreciation, depletion, or charge-off to expense of intangible and tangible assets over a period of time. In the extractive industries, the term is most frequently applied to mean either (1) the periodic charge-off to expense of the costs associated with non-producing mineral properties incurred prior to the time when they are developed and entered into production or (2) the systematic charge-off to expense of those costs of productive mineral properties (including tangible and intangible costs of prospecting, acquisition, exploration, and development) that had been initially capitalized (or deferred) prior to the time the properties entered into production, and thereafter are charged off as minerals are produced.

Ampere
The unit of measurement of electrical current produced in a circuit by 1 volt acting through a resistance of 1 Ohm.

Ancillary services
Services are designed to maintain the reliability of power supply to end-users. Ancillary services can include regulation, spinning reserve, non-spinning reserve and replacement reserve. Independent system operators create a market for buying and selling ancillary services, which help control the flow of electricity and provide energy ‘reserves’ to maintain reliability.

Annual cap
In a gas buyers’ purchase agreement, there is often a limit higher than the annual contract quantity (ACQ), above which the seller is not liable to sell. This is the annual cap and is usually stated as a percentage of the ACQ. Also known as the maximum annual quantity.

Annual contract quantity (ACQ)
The amount of gas specified in a buyer’s nomination purchase contract for one year. Some rights, such as make-up gas and take-or-pay, may need to be taken into account depending on the amount of gas taken versus the amount contracted for.

Annual operating factor
The annual fuel consumption divided by the product of design firing rate and hours of operation per year.

Annual requirement
The reporting company’s best estimate of the annual requirement for natural gas to make direct sales or sales for resale under certificate authorizations and for company use and unaccounted-for gas during the year next following the current report year.

Anthracite
The highest rank of coal; used primarily for residential and commercial space heating. It is a hard, brittle, and black lustrous coal, often referred to as hard coal, containing a high percentage of fixed carbon and a low percentage of volatile matter. The moisture content of fresh-mined anthracite generally is less than 15 percent. The heat content of anthracite ranges from 22 to 28 million Btu per ton on a moist, mineral-matter-free basis. The heat content of anthracite coal consumed in the United States averages 25 million Btu per ton, on the as-received basis (i.e., containing both inherent moisture and mineral matter). Note: Since the 1980′s, anthracite refuse or mine waste has been used for steam electric power generation. This fuel typically has a heat content of 15 million Btu per ton or less.

API

  1. American Petroleum Institute.
  2. All Publications Index, a price index for coal supply cost insurance and freight Amsterdam-Rotterdam-Antwerp.
  3. All Publications Index, a price index for coal shipments free-on-board Richards Bay.
  4. A measurement of the viscosity of liquids, like oil.

API gravity
One of the main quality indicators for pricing crude oil – the higher the API gravity, the lighter the crude. API gravity= 141.5/specific gravity of crude at 60° Fahrenheit – 131.5

Apparent consumption
Coal:  Coal production plus imports of coal, coke, and briquets minus exports of coal, coke, and briquets plus or minus stock changes. Note: The sum of “Production” and “Imports” less “Exports” may not equal “Consumption” due to changes in stocks, losses, unaccounted-for coal, and special arrangements such as the United States shipments of anthracite to United States Armed Forces in Europe.
Natural gas:  The total of an individual nation’s dry natural gas production plus imports less exports.
Petroleum:  Consumption that includes internal consumption, refinery fuel and loss, and bunkering. For countries in the Organization for Economic Cooperation and Development (OECD), apparent consumption is derived from refined product output plus refined product imports minus refined product exports plus refined product stock changes plus other oil consumption (such as direct use of crude oil). For countries outside the OECD, apparent consumption is either a reported figure or is derived from refined product output plus refined product imports minus refined product exports, with stock levels assumed to remain the same. Apparent consumption also includes, where available, liquefied petroleum gases sold directly from natural gas processing plants for fuel or chemical uses.
Power:  The product of the voltage (in volts) and the current (in amperes). It comprises both active and reactive power. It is measured in “volt-amperes” and often expressed in “kilovolt-amperes” (kVA) or “megavolt-amperes” (MVA).

APX-Endex
APX-Endex is an energy exchange with platforms on which gas and electricity are traded. It offers a trading platform for the UK, Belgium and The Netherlands. APX-Endex is particularly known for being a facilitator of the imbalance market.

ARA
Amsterdam- Rotterdam- Antwerp area- a port and refining area in the Belgian-Dutch region. A cargo or barge of a refined product traded on a cost, insurance and freight ARA basis means that ports within this area are covered in the cost. A cargo traded on a free-on-board basis means the cargo can come from any of these ports.

Area price
The price of electricity in one particular region within an integrated grid, such as Nord Pool.

Argus
An independent energy data & news reporting agency.

As received coal
Coal in the condition as received by the user.

As-received condition or as-received basis (coal)
Coal in the condition as received by the consumer or the laboratory analyzing the coal.

Ash
Impurities consisting of silica, iron, alumina, and other noncombustible matter that are contained in coal. Ash increases the weight of coal, adds to the cost of handling, and can affect its burning characteristics Ash content is measured as a percent by weight of coal on an “as received” or a “dry” (moisture-free, usually part of a laboratory analysis) basis.

Asset sweating
Increasing the efficiencies of an existing plant in order to avoid the need to build new infrastructure. This strategy was pursued throughout the 1990s in the UK power sector and the oil refining and producing sector in the West.

Associated (dissolved) natural gas
Natural gas that occurs in crude oil reservoirs either as free gas (associated) or as gas in solution with crude oil (dissolved gas).

At wt
The abbreviation for atomic weight.

Atlantic Basin
The geographical region that can be considered as comprising all land masses (including islands) that lie adjacent to or within the Atlantic Ocean and adjacent waters, including the Baltic Sea, North Sea, Black Sea, Davis Strait, Denmark Strait, part of the Drake passage, Labrador Sea, Mediterranean Sea, Norwegian Sea, most of the Scotia Sea, Baffin Bay, Hudson Bay, Gulf of St. Lawrence, the Gulf of Mexico, Caribbean Sea and the Weddell Sea. As applied to the energy market, the Atlantic Basin liquefied natural gas (LNG) market encompasses LNG producers and consumers in or adjacent to the Atlantic Basin geographical area noted above. The Atlantic Basin LNG markets can be considered to specifically include the LNG producers (current and projected): Abu Dhabi, Algeria, Angola, Egypt, Equatorial Guinea, Iran, Libya, Nigeria, Norway, Oman, Qatar, Russia, Trinidad & Tobago, Venezuela and Yemen. The current and likely future LNG consuming countries: Argentina, Belgium, Brazil, Canada, Cyprus, Dominican Republic, France, Germany, Greece, Italy, Mexico, the Netherlands, Poland, Portugal, Puerto Rico, South Africa, Spain, Turkey, the UK, the US and possibly the Bahamas and Jamaica. Note that an Atlantic Basin LNG producer might not be physically located in the Atlantic Basin itself.

At-the-beach
(UK) when gas has been brought ashore to a terminal by producers but is not yet in the national transmission system, the gas is called at-the-beach.

Atmospheric crude oil distillation
The refining process of separating crude oil components at atmospheric pressure by heating to temperatures of about 600 degrees to 750 degrees Fahrenheit (depending on the nature of the crude oil and desired products) and subsequent condensing of the fractions by cooling.

Auctioning
As applied to the energy sector, auctions as a pricing mechanism have been used or have been planned for liquefied natural gas storage capacity, emission allowances and transmission capacity, in order to manage congestion.

Auger mine
A surface mine in which the coal bed is removed by means of a large diameter drill. Usually operated only when the overburden becomes too thick for economical strip mining.

Auxiliary generator
A generator at the electric plant site that provides power for the operation of the electrical generating equipment itself, including related demands such as plant lighting, during periods when the electric plant is not operating and power is unavailable from the grid. A black start generator used to start main central station generators is considered to be an auxiliary generator.

Available but not needed capability
Net capability of main generating units that are operable but not considered necessary to carry load and cannot be connected to load within 30 minutes.

Available transfer capability (ATC)
A measure of the transfer capability remaining in the physical transmission network for further commercial activity over and above already committed uses. ATC is defined as the total transfer capability, less the transmission reliability margin, less the sum of existing transmission commitments (which includes retail customer service) and the capacity benefit margin.

Average daily production
The ratio of the total production at a mining operation to the total number of production days worked at the operation.

Average delivered price
The weighted average of all contract price commitments and market price settlements in a delivery year.

Average stream flow
The rate, usually expressed in cubic feet per second, at which water passes a given point in a stream over a set period of time.

Aviation gasoline (finished)
A complex mixture of relatively volatile hydrocarbons with or without small quantities of additives, blended to form a fuel suitable for use in aviation reciprocating engines. Fuel specifications are provided in ASTM Specification D 910 and Military Specification MIL-G-5572. Note: Data on blending components are not counted in data on finished aviation gasoline.

Aviation gasoline blending components
Naphtha’s that will be used for blending or compounding into finished aviation gasoline (e.g., straight run gasoline, alkylate, reformate, benzene, toluene, and xylene). Excludes oxygenates (alcohols, ethers), butane, and pentanes plus. Oxygenates are reported as other hydrocarbons, hydrogen, and oxygenates.

B

Backup generator
A generator that is used only for test purposes, or in the event of an emergency, such as a shortage of power needed to meet customer load requirements.

Backup power
Electric energy supplied by a utility to replace power and energy lost during an unscheduled equipment outage.

Balancing

Balancing, or load balancing, is a requirement made of transmission systems that the energy sent or requested from energy producers or other suppliers be equal to the amount of energy delivered to customers.

Balancing authority (electric)
The responsible entity that integrates resource plans ahead of time, maintains load-interchange-generation balance within a Balancing Authority Area, and supports Interconnection frequency in real time.

Balancing energy supply

Balancing energy supply is the quantity of the total reserve energy available to be added into the system over and above any energy scheduled for use at a given time. It is a combination of all reserves ready to be pressed into use whenever an imbalance occurs between system load and customer demand. These reserves can include spinning and non-spinning reserves, replacement reserve, regulation, and any other energy from generators that can respond to a short-notice request for more energy.

Balancing item
Represents differences between the sum of the components of natural gas supply and the sum of the components of natural gas disposition. These differences may be due to quantities lost or to the effects of data reporting problems. Reporting problems include differences due to the net result of conversions off low data metered at varying temperature and pressure bases and converted to a standard temperature and pressure base; the effect of variations in company accounting and billing practices; differences between billing cycle and calendar period time frames; and imbalances resulting from the merger of data reporting systems that vary in scope, format, definitions, and type of respondents.

Balancing mechanism
In an electricity grid or natural gas pipeline network, the means of ensuring that supply does not outstrip demand, or vice versa.

Balancing regime
There must be a balance in energy networks (of gas and electricity, for example) between what is put in and what is taken out, otherwise problems arise. The service operator demands that parties in the energy market bear the responsibility for this balance. If they land in a situation of imbalance, they must rectify it quickly or be fined by the service operator.

Baltic exchange
A membership located in London for the maritime bulk freight market.

Banking
A procedure by which excess gas or emission rights that one shipper cannot use is lent to another shipper to be returned at a later date.

Bare-boat charter
A chartering arrangement whereby a vessel is contracted for without crew or provisions, and can have distinctions or implications in terms of legal responsibility relative to other types of charter arrangements.

Barge
Motored or motorless vessel used to carry oil products, often along a river. Barges vary in capacity, usually from 1000 to 5000 tonnes.

Barrel
Standard measure of quantity for crude oil and petroleum products. Barrel, US barrel and standard barrel are all equal to 42 US gallons.

Barrels of oil equivalent (BOE)
Volume of natural gas expressed in terms of its energy equivalent to oil. About 6000 cubic feet of gas equals one barrel of oil equivalent.

Base (cushion) gas
The volume of gas needed as a permanent inventory to maintain adequate reservoir pressures and deliverability rates throughout the withdrawal season. All native gas is included in the base gas volume.

Base load
The minimum expected customer power requirements at a given time. Base load power is generally supplied from larger plants, which cannot be ramped up and down as quickly as peaking generation plants. As base load demand is generally predictable and steady, it is less expensive than peak power.

Base load capacity
The generating equipment normally operated to serve loads on an around-the-clock basis.

Base load generation
Electricity-generating equipment normally operated to serve loads on an around-the clock basis.

Base load plant
A plant, usually housing high-efficiency steam-electric units, which is normally operated to take all or part of the minimum load of a system, and which consequently produces electricity at an essentially constant rate and runs continuously. These units are operated to maximize system mechanical and thermal efficiency and minimize system operating costs.

Base load supply
The actual available power used to meet minimum expected customer requirements at a given time (base load demand). Price structures for base load supply tend to run in the opposite direction of prices for peak supply. Base load supply tends to be steady and relatively cheap, although the fixed costs are normally much higher than peak supply prices. Peak supplies tend to be costly, but fixed costs are relatively low since the facilities used to generate peak supplies don’t have to be in steady operation.

Base load unit
An energy generating facility whose sole or primary purpose is to meet base load demand, or provide minimum power requirements for customers. Base load units are typically the most reliable and highest output generating facilities within a given group of generating units, and should, at least in theory, produce energy at the lowest cost.

Basis
The differential that exists at any time between the cash – or spot – price of a given commodity and the price of the nearest futures contract for the same (or related) commodity. The basis may reflect different time periods, product forms, qualities or locations. The cash price minus the futures price equals the basis.

Basis risk        
Basis risk is the risk that the value of a futures contract (or an over-the-counter hedge) will not move in line with that of the underlying exposure. Alternatively, it is the risk that the cash-futures spread will widen or narrow between the times at which a hedge position is implemented and liquidated. There are various types of basis risk. For example, a heating oil wholesaler selling its product in Baltimore will be exposed to basis risk if it hedges using New York Harbor heating oil futures contracts listed by Nymex. This is a ‘locational’ basis risk. Other forms of basis risk include ‘product’ basis, arising from mismatches in type or quality of hedge and underlying (e.g., hedging jet fuel with heating oil); and ‘time’ or ‘calendar’ basis (e.g., hedging an exposure to physical prices in December with a January futures contract).

Basis swap
Basis swaps are used to hedge exposure to basis risk, such as locational risk or time-exposure risk. For example, a natural gas basis swap could be used to hedge a locational price risk: the seller receives from the buyer a Nymex division settlement value (usually the average of the last three days’ closing prices) plus a negotiated fixed basis, and pays the buyer the published index value of gas sold at a specified location.

Basis trading  
A trading strategy whereby trades are placed simultaneously in a derivative contract, normally a future, and the underlying asset. The purpose is either to cover derivatives sold or to attempt an arbitrage strategy. This arbitrage can either take advantage of an existing mispricing (in cash and- carry arbitrage) or be based on speculation that the basis risk will change.

Basra Light
A crude oil produced in southern Iraq that contains approximately 2% sulphur by weight with an API gravity of about 34. 

Bbl
The abbreviation for barrel.

Bcf
The abbreviation for billion cubic feet (of gas).

B/d, bd or bpd
Barrels per day. Used to express crude oil production, refinery throughput capacity (i.e., capacity of the crude distillation unit), liftings, forward demand projections and crude consumption rates. 

Beach gas
(UK) gas produced offshore and brought onshore to the shore/beach gas terminal, but not yet part of the national transmission system.

Benchmark
Standard of reference used for measuring the relative strength of performance. 

Benchmark crude
Synonymous with reference crude or marker crude. A crude oil whose price is used as a reference against which other crudes are priced. Because of their liquidity, the Nymex West Texas Intermediate and Intercontinental Exchange/ ICE Futures’ Brent crude oil futures contracts are used as global benchmarks. Dubai crude is widely used as a benchmark for Middle Eastern crudes, especially for sale to Asian markets.

Bi-fuel vehicle
A motor vehicle that operates on two different fuels, but not on a mixture of the fuels. Each fuel is stored in a separate tank.

Bilateral agreement
A written statement signed by two parties that specifies the terms for exchanging energy.

Bilateral contract
A contract directly between a buyer and a seller or supplier.

Bilateral electricity contract
A direct contract between an electric power producer and either a user or broker outside of a centralized power pool or power exchange.

Bill of lading (b/l)
A ship owner’s receipt for its cargo, which includes cargo details, such as loading times.

Billing period
The time between meter readings. It does not refer to the time when the bill was sent or when the payment was to have been received. In some cases, the billing period is the same as the billing cycle that corresponds closely (within several days) to meter-reading dates. For fuel oil and LPG, the billing period is the number of days between fuel deliveries.

Biodiesel
A fuel typically made from soybean, canola, or other vegetable oils; animal fats; and recycled grease. It can serve as a substitute for petroleum-derived diesel or distillate fuel. For EIA reporting, it is a fuel composed of mono-alkyl esters of long chain fatty acids derived from vegetable oils or animal fats, designated B100, and meeting the requirements of ASTM (American Society for Testing materials) D 6751.

Biomass energy
Energy produced by the combustion of plants, vegetation or agricultural waste – for example, rice husks.

Biofuels
Liquid fuels and blending components produced from biomass feedstocks, used primarily for transportation.

Biogenic
Produced by biological processes of living organisms. Note: EIA uses the term “biogenic” to refer only to organic nonfossil material of biological origin.

Biogenic emissions
Emissions that are naturally occurring and are not significantly affected by human actions or activity.

Biomass
Organic nonfossil material of biological origin constituting a renewable energy source.

Biomass gas
A medium Btu gas containing methane and carbon dioxide, resulting from the action of microorganisms on organic materials such as a landfill.

Bitumen
A naturally occurring viscous mixture, mainly of hydrocarbons heavier than pentane, that may contain sulphur compounds and that, in its natural occurring viscous state, is not recoverable at a commercial rate through a well.

Bituminous coal
A dense coal, usually black, sometimes dark brown, often with well-defined bands of bright and dull material, used primarily as fuel in steam-electric power generation, with substantial quantities also used for heat and power applications in manufacturing and to make coke. Bituminous coal is the most abundant coal in active U.S. mining regions. Its moisture content usually is less than 20 percent. The heat content of bituminous coal ranges from 21 to 30 million Btu per ton on a moist, mineral-matter-free basis. The heat content of bituminous coal consumed in the United States averages 24 million Btu per ton, on the as-received basis (i.e., containing both inherent moisture and mineral matter).

Blackout
A total loss of power caused by the failure of the generation, transmission or distribution system.

Blast furnace
A furnace in which solid fuel (coke) is burned with an air blast to smelt ore.

Blast-furnace gas
The waste combustible gas generated in a blast furnace when iron ore is being reduced with coke to metallic iron. It is commonly used as a fuel within steel works.

Blending
(Gas) mixing gases of different specifications to produce one within the required gas specification. (Crude) sometimes crudes are blended near source when the same storage terminal or pipeline is used. An example is Brent blend – a blend of crudes from various fields in the East Shetland Basin. Also used to create components for gasoline.

Blending plant
A facility that has no refining capability but is either capable of producing finished motor gasoline through mechanical blending or blends oxygenates with motor gasoline.

BOE
Barrels of oil equivalent

Bone coal
Coal with a high ash content; it is dull in appearance, hard, and compact.

Book transfer
The transfer of title of a cash commodity to the buyer without a corresponding physical movement.

Book value
The portion of the carrying value (other than the portion associated with tangible assets) prorated in each accounting period, for financial reporting purposes, to the extracted portion of an economic interest in a wasting natural resource.

Bottleneck
Caused when the flow of electricity is greater than the system capacity between two connected grids. Bottlenecks can lead to an area becoming isolated. In an exchange, this can cause attendant price imbalances between the area price and system price.

Borderline customer
A customer located in the service area of one utility, but supplied by a neighboring utility through an arrangement between the utilities.

Bottom ash
Residue mainly from the coal burning process that falls to the bottom of the boiler for removal and disposal.

Bottom-hole contribution
A payment (either in cash or in acreage) that is required by agreement when a test well is drilled to a specified depth regardless of the outcome of the well and that is made in exchange for well and evaluation data.

Bp
The abbreviation for boiling point.

Break-even cutoff grade
The lowest grade of material that can be mined and processed considering all applicable costs, without incurring a loss or gaining a profit.

Breeder reactor
A reactor that both produces and consumes fissionable fuel, especially one that creates more fuel than it consumes. The new fissionable material is created by a process known as breeding, in which neutrons from fission are captured in fertile materials.

Breeze
The fine screenings from crushed coke. Usually breeze will pass through a 1/2-inch or 3/4-inch screen opening. It is most often used as a fuel source in the process of agglomerating iron ore.

Brent blend crude oil
UK Brent blend is a blend of crude oil from various fields in the East Shetland Basin between Scotland and Norway in the North Sea. The crude is landed at the Sullom Voe terminal and is used as a benchmark for the pricing of much of the world’s crude oil production.

Brent, Forties, Oseberg (BFO)
Information provider Platts’ replacement for the traditional Brent price index, intended to widen the number of crude oil grades used to determine the price of the key North Sea benchmark. It was launched in 2002 – as liquidity in Brent markets reduced, Platt’s introduced the changes to limit potential manipulation of the index.

British thermal unit (Btu)
The amount of heat required to raise the temperature of 1lb of water by 1° Fahrenheit (technically from 60°F to 61°F). It is used to compare the heat-producing value of different fuels.

Brownout
A partial loss of power caused by unexpectedly high demand or problems with the physical delivery of electricity. A brownout may result in lights dimming or electrical machinery slowing down. In most cases, brownouts are deliberately produced by energy providers as an emergency measure to prevent the system from failing completely (blacking out). Typically a utility will decrease system voltage by 10-25%, usually for a short period of time. This reduction typically has minimal effect on heat and lighting systems, most of which can function reliably for short periods on suboptimal voltage, but sensitive electronic equipment requiring reasonably precise voltages may not be able to function, and long-term brownouts can cause premature wear in nonelectronic devices. Computer disk drives often suffer write failures when supplied with suboptimal voltage, and electric motors tend to run hotter when required to produce the same horsepower during a brownout. Normal fluctuations in voltage do not qualify as brownouts. System voltage in many service areas can vary by as much as five percent above or below ‘nominal’ line voltage. Manufacturers of electrical and electronic products know this. Most North American consumer and commercial products are designed to function normally and safely for long periods at voltages ranging from 115 to 125 volts.

Btu
The abbreviation for British Thermal Unit(s).

Btu conversion factor
A factor for converting energy data between one unit of measurement and British thermal units (Btu). Btu conversion factors are generally used to convert energy data from physical units of measure (such as barrels, cubic feet, or short tons) into the energy-equivalent measure of Btu.

Btu per cubic foot
The total heating value, expressed in Btu, produced by the combustion, at constant pressure, of the amount of the gas that would occupy a volume of 1 cubic foot at a temperature of 60 degrees F if saturated with water vapor and under a pressure equivalent to that of 30 inches of mercury at 32 degrees F and under standard gravitational force (980.665 cm. per sec. squared) with air of the same temperature and pressure as the gas, when the products of combustion are cooled to the initial temperature of gas and air when the water formed by combustion is condensed to the liquid state.(Sometimes called gross heating value or total heating value.)

Built-in electric units
An individual-resistance electric-heating unit that is permanently installed in the floors, walls, ceilings, or baseboards and is part of the electrical installation of the building. Electric-heating devices that are plugged into an electric socket or outlet are not considered built in.

Bulk power transactions
The wholesale sale, purchase, and interchange of electricity among electric utilities. Bulk power transactions are used by electric utilities for many different aspects of electric utility operations, from maintaining load to reducing costs.

Bulk sales
Wholesale sales of gasoline in individual transactions which exceed the size of a truckload.

Bulk station
A facility used primarily for the storage and/or marketing of petroleum products, which has a total bulk storage capacity of less than 50,000 barrels and receives its petroleum products by tank car or truck.

Bulk terminal
A facility used primarily for the storage and/or marketing of petroleum products, which has a total bulk storage capacity of 50,000 barrels or more and/or receives petroleum products by tanker, barge, or pipeline.

Bundesnetzagentur (BnetzA)
The German Federal Network Agency for electricity, gas, telecommunications, post and railway, headquartered in Bonn, provides for the further development of the electricity, gas, telecommunications and postal markets and, since 2006, also of the railway infrastructure market. In order to implement effective regulations, the agency has the authority to obtain information and conduct investigations, as well as the right to impose graded sanctions:
www.bundesnetzagentur.de

Bundled rate
A combined charge for the provision of two or more services – e.g., gas transportation and storage, or electricity generation and transmission.

Bundled services
Two or more electricity or gas services provided at a combined charge – e.g., gas transportation and storage; electricity generation and transmission.

Bundled utility service (electric)
A means of operation whereby energy, transmission, and distribution services, as well as ancillary and retail services, are provided by one entity.

Bunker fuels
Fuel supplied to ships and aircraft, both domestic and foreign, consisting primarily of residual and distillate fuel oil for ships and kerosene-based jet fuel for aircraft. The term “international bunker fuels” is used to denote the consumption of fuel for international transport activities. Note: For the purposes of greenhouse gas emissions inventories, data on emissions from combustion of international bunker fuels are subtracted from national emissions totals. Historically, bunker fuels have meant only ship fuel.

Buy-back oil
Crude oil acquired from a host government whereby a portion of the government’s ownership interest in the crude oil produced in that country may or should be purchased by the producing firm.

Buyer’s nomination contract
A gas contract where the buyer has the option to nominate the delivery requirements up to the predefined delivery capacity. The seller is obliged, under this type of contract, to deliver as requested, although limits are often built into the contract.

C

CAF
Cost and freight. The price includes the cost of the cargo and the freight/vessel hiring costs, but not the insurance.

Calcination
A process in which a material is heated to a high temperature without fusing, so that hydrates, carbonates, or other compounds are decomposed and the volatile material is expelled.

California power exchange
A State-chartered, non-profit corporation which provides day-ahead and hour-ahead markets for energy and ancillary services in accordance with the power exchange tariff. The power exchange is a scheduling coordinator and is independent of both the independent system operator and all other market participants.

Calorific value (CV)
A measure of the energy released as heat when a fuel is burned. It may be measured wet (with water vapor) or dry (after the water vapor has been removed). It may also be measured gross or net – gross includes the heat produced when the water vapor is condensed into a liquid, and net does not. Generally, CV is measured gross and dry.

Cannel coal
A compact, tough variety of coal, originating from organic spore residues, that is non-caking, contains a high percentage of volatile matter, ignites easily, and burns with a luminous smoky flame.

Capacity (purchased)
The amount of energy and capacity available for purchase from outside the system.

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.

Capacity factor
The amount of energy that a power generation plant actually generates compared to its maximum rated output, expressed as a percentage.

Capacity options
The right to access the output of a plant, whose generation is specifically earmarked.

Capacity purchase agreement (CPA)
A legal document for transferring transmission capacity for a defined period.

Capacity trading
Where a gas shipper with spare capacity in a transportation system – e.g., the UK’s national transmission system – sells or leases its rights to transport gas in a pipeline. (US) trading of transportation rights that has been facilitated through the use of electronic bulletin boards or electronic data interchange.

Capacity transaction
The acquisition of a specified quantity of generating capacity from another utility for a specified period of time. The utility selling the power is obligated to make available to the buyer a specified quantity of power.

Capacity utilization
Capacity utilization is computed by dividing production by productive capacity and multiplying by 100.

Captive coal
Coal produced and consumed by the mine operator, a subsidiary, or parent company (for example, steel companies and electric utilities).

Capital cost
The cost of field development and plant construction and the equipment required for industry operations.

Captive coal
Coal produced to satisfy the needs of the mine owner, or of a parent, subsidiary, or other affiliate of the mine owner (for example, steel companies and electricity generators), rather than for open market sale.

Captive refinery MTBE plants
MTBE (methyltertiary butyl ether) production facilities primarily located within refineries. These integrated refinery units produce MTBE from Fluid Cat Cracker isobutylene with production dedicated to internal gasoline blending requirements.

Captive refinery oxygenate plants
Oxygenate production facilities located within or adjacent to a refinery complex.

Carbon cycle
All carbon sinks and exchanges of carbon from one sink to another by various chemical, physical, geological, and biological processes.

Carbon dioxide (CO2)
A gas produced by the burning of fuel. Many scientists believe it to be a major contributor to the greenhouse effect.

Carbon-dioxide equivalent
The accepted measurement unit for greenhouse gases under the Kyoto Protocol.

Carbon intensity
The amount of carbon by weight emitted per unit of energy consumed. A common measure of carbon intensity is weight of carbon per British thermal unit (Btu) of energy. When there is only one fossil fuel under consideration, the carbon intensity and the emissions coefficient are identical. When there are several fuels, carbon intensity is based on their combined emissions coefficients weighted by their energy consumption levels.

Carbon output rate
The amount of carbon by weight per kilowatt-hour of electricity produced.

Carbon sequestration
Capturing carbon dioxide in carbon sinks, thus limiting its presence in the atmosphere.

Carbon sinks
Forests, soils or oceans that store more carbon dioxide than they release, thereby limiting the gas’ contribution to the greenhouse effect. Carbon sinks can be used as part of an emissions trading system.

Carbon stocks
The quantity of carbon stored in biological and physical systems including: trees, products of harvested trees, agricultural crops, plants, wood and paper products and other terrestrial biosphere sinks, soils, oceans, and sedimentary and geological sinks.

Carrying costs
Costs incurred in order to retain exploration and property rights after acquisition but before production has occurred. Such costs include legal costs for title defense, ad valorem taxes on nonproducing mineral properties, shut-in royalties, and delay rentals.

Carry forward
(Gas) if, in a given contract period (often a year), a buyer has taken more than the annual contact quantity then, if there is no accumulated makeup gas, the buyer can carry forward this excess for future use. The buyer may use the carry-forward to offset the take-or-pay obligation, although there may be a limit to the amount of carry forward allowed in any given contract period.

Carrying charge
The total cost of storing a physical commodity, including storage, insurance, interest and opportunity cost.

Cascading
The conversion of a forward contract into a series of shorter-term contracts on maturity.

Cash and carry
Kerosene, fuel oil, or bottled gas (tank or propane) purchased with cash, by check, or by credit card and taken home by the purchaser. The purchaser provides the container or pays extra for the container.

Casinghead gas (or oil well gas)
Natural gas produced along with crude oil from oil wells. It contains either dissolved or associated gas or both.

Cat cracking
Catalytic cracking is a refining process that breaks down heavier crude oil fractions into motor spirit and gasoil/heating oil blending components by passing them over a suitable catalyst.

Catalyst coke
In many catalytic operations (e.g., catalytic cracking), carbon is deposited on the catalyst, thus deactivating the catalyst. The catalyst is reactivated by burning off the carbon, which is used as a fuel in the refining process. This carbon or coke is not recoverable in a concentrated form.

Catalytic converter
A device containing a catalyst for converting automobile exhaust into mostly harmless products.

Catalytic cracking
The refining process of breaking down the larger, heavier, and more complex hydrocarbon molecules into simpler and lighter molecules. Catalytic cracking is accomplished by the use of a catalytic agent and is an effective process for increasing the yield of gasoline from crude oil. Catalytic cracking processes fresh feeds and recycled feeds.

Catalytic hydro cracking
A refining process that uses hydrogen and catalysts with relatively low temperatures and high pressures for converting middle boiling or residual material to high octane gasoline, reformer charge stock, jet fuel, and /or high grade fuel oil. The process uses one or more catalysts, depending on product output, and can handle high sulfur feed stocks without prior desulfurization.

Catalytic hydro treating
A refining process for treating petroleum fractions from atmospheric or vacuum distillation units (e.g., naphtha’s, middle distillates, reformer feeds, residual fuel oil, and heavy gas oil) and other petroleum (e.g., cat cracked naphtha, coker naphtha, gas oil, etc.) in the presence of catalysts and substantial quantities of hydrogen. Hydro treating includes desulfurization, removal of substances (e.g., nitrogen compounds) that deactivate catalysts, conversion of olefins to paraffins to reduce gum formation in gasoline, and other processes to upgrade the quality of the fractions.

Catalytic reforming
A refining process using controlled heat and pressure with catalysts to rearrange certain hydrocarbon molecules, there by converting paraffinic and naphthenic type hydrocarbons (e.g., low octane gasoline boiling range fractions) into petrochemical feedstocks and higher octane stocks suitable for blending into finished gasoline. Catalytic reforming is reported in two categories. They are:

  • Low Pressure. A processing unit operating at less than 225 pounds per square inch gauge (PSIG) measured at the outlet separator.
  • High pressure. A processing unit operating at either equal to or greater than 225 pounds per square inch gauge (PSIG) measured at the outlet separator.

CBOB
Conventional gasoline blendstock for oxygenate blending

CDD
Cooling degree-days.

Cells
Refers to the un-encapsulated semi-conductor components of the module that convert the solar energy to electricity.

Central physical plant
A plant owned by, and on the grounds of, a multibuilding facility that provides district heating, district cooling, or electricity to other buildings on the same facility. To qualify as a central plant it must provide district heat, district chilled water, or electricity to at least one other building. The central physical plant may be by itself in a separate building or may be located in a building where other activities occur.

Certificate
A type of permit for public convenience and necessity issued by a utility commission, which authorizes a utility or regulated company to engage in business, construct facilities, provide some services, or abandon service.

Certificate requirement
The maximum annual volume allowed for sales to resale or direct sale customers under certificate authorizations by the Federal Energy Regulatory Commission.

Certified Emission Reduction (CER)
The right to emit 650,000 tonnes of CO2. CER is the technical term for the output of Clean Development Mechanism (CDM) projects, as defined by the Kyoto  protocol. A unit of greenhouse gas reductions that has been generated and certified under the provisions of Article 12 of the Kyoto Protocol, the CDM.

CCGT
Combined-cycle gas turbine

CDM
Clean Development Mechanism

Centistoke
One of the many ways of expressing the viscosity of fuel oil.

Certified Emission Rights (CER)
The right to emit 650,000 tonnes of CO2.

CF
Cubic Foot

CFD
Contract for differences

CH4
Methane

Chain
A forward contract for the delivery of a commodity that has been traded many times by several parties, thereby forming a chain between the final buyer and the initial seller.

Chained dollars
A measure used to express real prices. Real prices are those that have been adjusted to remove the effect of changes in the purchasing power of the dollar; they usually reflect buying power relative to a reference year. Prior to 1996, real prices were expressed in constant dollars, a measure based on the weights of goods and services in a single year, usually a recent year. In 1996, the U.S. Department of Commerce introduced the chained-dollar measure. The new measure is based on the average weights of goods and services in successive pairs of years. It is “chained” because the second year in each pair, with its weights, becomes the first year of the next pair. The advantage of using the chained-dollar measure is that it is more closely related to any given period covered and is therefore subject to less distortion over time.

Charge capacity
The input (feed) capacity of the refinery processing facilities.

Charter party
A contract by which the owner of a vessel (aircraft or ship) leases his craft to or hires a charterer for a fixed period of time or a set number of voyages. Normally, the vessel owner retains rights of possession and control while the charterer has the right to choose the ports of call. It also goes under the name of charter agreement or charter contract.

Charter rate
The shipping rate agreed between the owner of a vessel and the person or firm wanting to use the vessel in a charter party agreement.

Charterer
A person or firm who enters into a charter party agreement with the owner of a vessel for the transportation of cargo for a set period of time or number or voyages.

Chemical separation
A process for extracting uranium and plutonium from dissolved spent nuclear fuel and irradiated targets. The fission products that are left behind are high-level waste. Chemical separation is also known as reprocessing.

Chlorofluorocarbon (CFC)
Any of various compounds consisting of carbon, hydrogen, chlorine, and fluorine used as refrigerants. CFCs are now thought to be harmful to the earth’s atmosphere.

CHP
Combined heat and power

Christmas tree
The valves and fittings installed at the top of a gas or oil well to control and direct the flow of well fluids

CIF (cargo, insurance and freight)
CIF refers to cargos for which the seller pays for the transportation and insurance up to the port of destination. This term refers to a type of sale in which the buyer of the product agrees to pay a unit price that includes the f.o.b. value of the product at the point of origin plus all costs of insurance and transportation. This type of a transaction differs from a “delivered” purchase, in that the buyer accepts the quantity as determined at the loading port (as certified by the Bill of Lading and Quality Report) rather than pay based on the quantity and quality ascertained at the unloading port. It is similar to the terms of an f.o.b. sale, except that the seller, as a service for which he is compensated, arranges for transportation and insurance.

Clean dark spread
Refers to the profit realized by a power generator after paying for the cost of coal fuel and carbon allowances.

Clean Development Mechanism (CDM)
The Clean Development Mechanism (CDM), defined in Article 12 of the Kyoto Protocol, allows a country with an emission-reduction or emission-limitation commitment under the Kyoto Protocol (Annex B Party) to implement an emission-reduction project in developing countries. Such projects can earn saleable Certified Emission Reduction credits, each equivalent to one tonne of CO2, which can be counted towards meeting Kyoto targets.

Clean spark spread
The spread equal to the regular (or ‘dirty’) spark spread minus the CO2 emissions cost for gas fired power plants. This spread then represents the net revenue on power sales after gas costs and emissions allowance costs. An analogous spread for coal-fired generation plants is typically referred to as a clean dark spread or a dark green spread.

CNG
An acronym for compressed natural gas – natural gas that has been compressed under high pressure (typically 2,000–3,600psi).

CO
Carbon Monoxide.

CO2
Carbon Dioxide.

Coal bed
A bed or stratum of coal. Also called a coal seam.

Coal gasification
A process for converting coal partially or completely into combustible gases, for use as fuels or chemical feedstocks. 

Co-firing
Burning natural gas as well as another fuel type (usually coal) in order to decrease the amount of air pollutants and/or use the most competitively priced fuels available.

Cogeneration, ‘cogen’
The simultaneous generation of electrical and thermal energy where both forms of energy are put to productive use. The addition of cogeneration capability to generating facilities and industries that produce large amounts of heat energy helps ensure that waste heat (usually in the form of steam or hot water) is used efficiently for heating, industrial use, agriculture or conversion into electricity. 

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.

Coke (coal)
A solid carbonaceous residue derived from low-ash, low-sulfur bituminous coal from which the volatile constituents are driven off by baking in an oven at temperatures as high as 2,000 degrees Fahrenheit so that the fixed carbon and residual ash are fused together. Coke is used as a fuel and as a reducing agent in smelting iron ore in a blast furnace. Coke from coal is grey, hard, and porous and has a heating value of 24.8 million Btu per ton.

Coke (petroleum)
A residue high in carbon content and low in hydrogen that is the final product of thermal decomposition in the condensation process in cracking. This product is reported as marketable coke or catalyst coke. The conversion is 5 barrels (of 42 U.S. gallons each) per short ton. Coke from petroleum has a heating value of 6.024 million Btu per barrel.

Coke breeze
The term refers to the fine sizes of coke, usually less than one-half inch, that are recovered from coke plants. It is commonly used for sintering iron ore.

Coking coal
Bituminous coal suitable for making coke.

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.

Combined cycle power plants
Twin-stage power plants that deliver 50-60% higher fuel efficiency. In the first stage, a gas (natural gas, gaseous coal, etc.) is heated, cleaned, and used to run a gas turbine that produces electricity. In the second stage, the waste heat from the gas turbine, from gas cleaning, and from the gasification processes are used to raise the pressure of steam, which is in turn used for generation of additional power. By operating a combination of both these stages, a combined cycle power plant is able to maximize the efficiency of the fuel used. 

Combined-cycle gas turbine (CCGT)
An energy-efficient gas turbine system, where the first turbine generates electricity from the gas produced during fuel combustion. The hot gases pass through a boiler and then into the atmosphere. The steam from the boiler drives the second electricity-generating turbine.

Combined heat and power (CHP)
The production of two forms of energy, such as high-temperature heat and electricity, from the same process. For example, the steam produced from boiling water could be used for industrial heating. In the US, the term typically used for this process is co-generation.

Combined hydroelectric plant
A hydroelectric plant that uses both pumped water and natural streamflow for the production of power.

Combined pumped-storage plant
A pumped-storage hydroelectric power plant that uses both pumped water and natural stream flow to produce electricity.

Combustion
Chemical oxidation accompanied by the generation of light and heat.

Combustion chamber
An enclosed vessel in which chemical oxidation of fuel occurs.

Combustion turbine
An electricity generator that uses a jet engine as the prime mover. Often fuelled by natural gas or petroleum products and used as peaking generation.

Co-mingled
When a gas or crude oil outside contract specifications has been mixed with another gas in order to bring it within the required quality specifications.

Commercial operation (nuclear)
The phase of reactor operation that begins when power ascension ends and the operating utility formally declares the nuclear power plant to be available for the regular production of electricity. This declaration is usually related to the satisfactory completion of qualification tests on critical components of the unit.

Commissioning gas
Gas produced when a new field starts up, or the gas needed during the start-up of a power station. In both cases, the amount and timing of the requirements are not exact. 

Commodity
A physical good, typically produced in agriculture or mining, that can be the object of a commercial transaction. Or any index, rate, security or physical commodity that is or could be the underlying instrument or price determinant of a futures contract or other financial instrument. 

Commodity future
A futures contract on a commodity. Unlike financial futures, the prices of commodity futures are determined by supply and demand rather than the cost-of-carry of the underlying. Commodity futures can, therefore, either be in contango (where futures prices are higher than spot prices) or backwardation (where futures are lower than spot prices). 

Commodity swap
Commodity swaps enable both producers and consumers to hedge commodity prices. The consumer is usually a fixed payer and the producer a floating payer. If the floating-rate price of the commodity is higher than the fixed price, the difference is paid by the floating payer, and vice versa. Usually only the payment streams, not the principal, are exchanged, although physical delivery is becoming increasingly common. Swaps are sometimes done to hedge risks that cannot readily be hedged with futures contracts. This could be a geographical or quality basis risk, or it could arise from the maturity of a transaction.

Commodity trading adviser (CTA)
Directs trading in the managed accounts of a commodity pool. CTAs are professional money managers who manage client assets on a discretionary basis, using global futures markets as an investment medium.

Completion (oil/gas production)
The term refers to the installation of permanent equipment for the production of oil or gas. If a well is equipped to produce only oil or gas from one zone or reservoir, the definition of a “well” (classified as an oil well or gas well) and the definition of a “completion” are identical. However, if a well is equipped to produce oil and/or gas separately from more than one reservoir, a “well” is not synonymous with a “completion.”

Completion date (oil/gas production)
The date on which the installation of permanent equipment has been completed as reported to the appropriate regulatory agency. The date of completion of a dry hole is the date of abandonment as reported to the appropriate agency. The date of completion of a service well is the date on which the well is equipped to perform the service for which it was intended.

Compressed natural gas (CNG)
A product consisting of natural gas that has been compressed under high pressures, typically between 2,000 and 3,600psi, and is held in a hard container. It is used mainly as an alternative fuel for internal combustion engines (such as automobile engines). It generates low hydrocarbon emissions but a significant quantity of nitrogen-oxide emissions. CNG’s volumetric energy density is about 42% of liquefied natural gas’s and 25% of diesels. 

Compressor station
Gas loses pressure as it travels over long distances. A compressor station – usually a gas turbine engine – is an installation that recompresses the gas to the required pressure. 

Compulsory stocks
Crude oil and product stocks that an oil company is obliged to hold by the consuming government.

Concession
The right to explore a particular area for the presence of oil or gas, and then to exploit the area. 

Condensates
Mixtures of liquid hydrocarbons mainly recovered from gas reservoirs. They may include liquefied petroleum gases (propane and butane), naphtha and gasoil or only some of the above fractions. Condensates are used both as refinery and petrochemical feedstocks.

Condenser cooling water
A source of water external to a boiler’s feed system is passed through the steam leaving the turbine in order to cool and condense the steam. This reduces the steam’s exit pressure and recaptures its heat, which is then used to preheat fluid entering the boiler, thereby increasing the plant’s thermodynamic efficiency.

Conference of the parties (COP)
The collection of nations that have ratified the Framework Convention on Climate Change(FCCC). The primary role of the COP is to keep implementation of the FCCC under review and make the decisions necessary for its effective implementation.

Congestion
Clogging and stress at a point where something must pass. Congestion in energy transmission systems occurs when local demand for energy approaches the limits of the transmission system’s ability to supply it.

Connection
The physical connection (e.g., transmission lines, transformers, switch gear, etc.) between two electric systems permitting the transfer of electric energy in one or both directions.

Constraints
Limitations in the capacity of transmission systems to transport power from generator to consumer. Any factor that contributes to this limitation is a system constraint.

Continental shelf
Geological undersea continuation of a continental region.

Contract for differences (CFD)
A long-term swap agreed bilaterally, generally between generators and electricity supply companies, and referenced to prices in the relevant pool. Or  a short-dated swap agreement used to minimize the basis risk between the daily published Platt’s quote for dated or physical Brent in a specific time window in the future and the forward price quote for a specific month. Settlement of a CFD is based on the published price difference at a designated time.

Conventional blendstock for oxygenate blending (CBOB)
Motor gasoline blending components intended for blending with oxygenates to produce finished conventional motor gasoline.

Conventional gasoline
Finished motor gasoline not included in the oxygenated or reformulated gasoline categories. Note: This category excludes reformulated gasoline blendstock for oxygenate blending (RBOB) as well as other blendstock.

Conventional hydroelectric plant
A plant in which all of the power is produced from natural streamflow as regulated by available storage.

Conventional oil and natural gas production
Crude oil and natural gas that is produced by a well drilled into a geologic formation in which the reservoir and fluid characteristics permit the oil and natural gas to readily flow to the wellbore.

Conventional thermal electricity generation
Electricity generated by an electric power plant using coal, petroleum, or gas as its source of energy.

Conversion factor
A factor for converting data between one unit of measurement and another (such as between short tons and British thermal units, or between barrels and gallons).

Cooling degree day
Degree day

Cost, insurance, freight (CIF)
A type of sale in which the buyer of the product agrees to pay a unit price that includes the f.o.b. value of the product at the point of origin plus all costs of insurance and transportation. This type of transaction differs from a “delivered” purchase in that the buyer accepts the quantity as determined at the loading port (as certified by the Bill of Loading and Quality Report) rather than pay on the basis of the quantity and quality ascertained at the unloading port. It is similar to the terms of an f.o.b. sale except that the seller, as a service for which he is compensated, arranges for transportation and insurance.

Cost of capital
The rate of return a utility must offer to obtain additional funds. The cost of capital varies with the leverage ratio, the effective income tax rate, conditions in the bond and stock markets, growth rate of the utility, its dividend strategy, stability of net income, the amount of new capital required, and other factors dealing with business and financial risks. It is a composite of the cost for debt interest, preferred stock dividends, and common stockholders’ earnings that provide the facilities used in supplying utility service.

Cost-of-carry
The cost-of-carry is the difference between the cost of financing an asset and the  interest received on that asset. If the financing cost is lower than the interest, the asset is said to have a positive cost-of-carry; if higher, the cost-of-carry is negative.

Council of European Energy Regulators (CEER)
The CEER is the organization in which independent national regulators of electricity and gas in Europe voluntarily cooperate. The CEER is a preparatory body for the work of the European Regulators Group for Electricity and Gas (ERGEG). The CEER is a not-for-profit association under Belgian law. 

Counter-purchase market
In a counter-purchase market, the system operator buys excess power from the grid when there is a surplus and sells reserve power to the grid when there is a shortfall. Costs to the system operator are recouped through tariffs charged to users of the system. 

Cracking
A refining technique that uses high pressures and temperatures to crack heavy hydrocarbons into lighter products. This process is more advanced than the simple distillation of crude oil.

Crack spread
A calculation of the worth of a barrel of crude oil in terms of the value of its refined products, such as gasoline and heating oil. Crack spreads may be based on a variety of refinery models and also depend on the type of crude input. They are usually expressed in dollars and cents per barrel of crude. To calculate the spread, the cents-per-gallon product prices are multiplied by 42 (the number of gallons per barrel) and subtracted from the crude oil price. For example, when heating oil futures cost $0.60 per gallon and Nymex division light, sweet crude oil is priced at $22 a barrel, the heating oil crack spread in dollars per barrel = $0.60 x 42 = $25.20 – $22 = $3.20.

Crop residue
Organic residue remaining after the harvesting and processing of a crop.

Cross trade
Offsetting match by a broker of the buy order of one customer against the sell order of another, or a match of a trade made by a broker with his customer, a practice that is permissible only when executed in accordance with the Commodity Exchange Act, Commodity Futures Trading Commission regulations, and rules of the contract market. Neither NYMEX Division nor COMEX Division members are permitted to take the opposite side of a customer’s order, except, under certain circumstances, for trades involving long-dated (nine months or more forward) COMEX Division copper futures.

Crude oil
A mixture of hydrocarbons that exists in liquid phase in natural underground reservoirs and remains liquid at atmospheric pressure after passing through surface separating facilities. Depending upon the characteristics of the crude stream, it may also include 1. Small amounts of hydrocarbons that exist in gaseous phase in natural underground reservoirs but are liquid at atmospheric pressure after being recovered from oil well (casing head) gas in lease separators and are subsequently coming led with the crude stream without being separately measured. Lease condensate recovered as a liquid from natural gas wells in lease or field separation facilities and later mixed into the crude stream is also included; 2. Small amounts of nonhydrocarbons produced with the oil, such as sulfur and various metals; 3. Drip gases, and liquid hydrocarbons produced from tar sands, oil sands, gilsonite, and oil shale.  Liquids produced at natural gas processing plants are excluded. Crude oil is refined to produce a wide array of petroleum products, including heating oils; gasoline, diesel and jet fuels; lubricants; asphalt; ethane, propane, and butane; and many other products used for their energy or chemical content.

Crude oil less lease condensate
A mixture of hydrocarbons that exists in liquid phase in natural underground reservoirs and remains liquid at atmospheric pressure after passing through surface separating facilities. Such hydrocarbons as lease condensate and natural gasoline recovered as liquids from natural gas wells in lease or field separation facilities and later mixed into the crude stream are excluded. Depending upon the characteristics of the crude stream, crude oil may also include: 1. Small amounts of hydrocarbons that exist in gaseous phase in natural underground reservoirs but are liquid at atmospheric pressure after being recovered from oil well (casing head) gas in lease separators and are subsequently comingled with the crude stream without being separately measured; 2. Small amounts of on hydrocarbons produced with the oil, such as sulfur and various metals.

Crude oil, refinery receipts
Receipts of domestic and foreign crude oil at a refinery. Includes all crude oil in transit except crude oil in transit by pipeline. Foreign crude oil is reported as a receipt only after entry through customs. Crude oil of foreign origin held in bonded storage is excluded.

Cubic foot
One of the standards used to measure a volume of gas.

Cumulative degree days
The sum of heating degree days or cooling degree days over a specified period.

Current (electric)
A flow of electrons in an electrical conductor. The strength or rate of movement of the electricity is measured in amperes.

Cushion gas
The minimum volume of gas required in an underground storage reservoir to provide the necessary pressure to deliver working gas volumes to customers. Known as ‘pack the line’ or line pack gas when related to pipelines.

Cut-off grade (uranium)
The lowest grade, in percent U3O8, of uranium ore at a minimum specified thickness that can be mined at a specified cost.

Cycle
The time period running from the startup of one reactor cycle to the startup of the following cycle.

Cycle/reactor history
A group of assemblies that have been irradiated in the same cycles in an individual reactor and are said to have the same cycle/reactor history.

Cycling (natural gas)
The practice of producing natural gas for the extraction of natural gas liquids, returning the dry residue to the producing reservoir to maintain reservoir pressure and increase the ultimate recovery of natural gas liquids. The reinjected gas is produced for disposition after cycling operations are completed. 

D

Daily balancing
Balancing, on a day-by-day basis, the amount of gas a shipper puts into a pipeline system.

Daily call option
Allows a buyer of natural gas to take additional volumes on one day’s notice.

Daily contract quantity (DCQ)
In a buyer’s nomination contract, this is the average amount the buyer can have in its daily nominations. The maximum rate at which the buyer can ask the seller to deliver is a function of the DCQ and the swing. A similar rule exists in a seller’s nomination contract, where it is called the estimated daily contract quantity.

Dark spread
The spread between the fuel and power price for a generator. The term spark spread is used for gas-fired, and, similarly, dark spread is used for coal-fired generation. Like a spark spread, the measure of the fuel efficiency of the conversion process in generation.

Dated Brent
A term for a physical cargo of Brent blend crude that has received its loading date range. This occurs 15 days ahead of loading (not including weekends and bank holidays).

Day-ahead and hour-ahead markets
Forward markets where electricity quantities and market clearing prices are calculated individually for each hour of the day on the basis of participant bids for energy sales and purchases.

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.

DC
Direct Current

DCQ
Daily contract quantity

Deadweight tons
The lifting capacity of a ship expressed in long tons (2,240 lbs.), including cargo, commodities, and crew.

Decatherm
Ten therms or 1,000,000 Btu.

Decommissioning
The process of removing a power plant, apparatus, equipment, building, or facility from operation.

Decontamination
Removal of unwanted radioactive or hazardous contamination by a chemical or mechanical process.

Deferred cost
An expenditure not recognized as a cost of operation of the period in which incurred, but carried forward to be written off in future periods.

Deferred fuel costs
An expenditure for fuel that is not recognized for bookkeeping practices as a cost in the operating period incurred, but carried forward to be written off in future periods.

Deforestation
The net removal of trees from forested land.

Degree day
A measure of the variation of one day’s temperature against a standard reference temperature, typically 65° Fahrenheit (18° Celsius). Degree days are used as a basis for temperature-related weather derivative deals. There are both cooling degree days (CDDs) and heating degree days (HDDs). For example, a firm takes out a 30-day CDD swap with a reference temperature of 65°F, and the average temperature on each day is 70°F. The company is then due 150 (30 x 5) degree days multiplied by the sum of money agreed for each degree day. If the firm had taken out an HDD swap, it would have owed the same amount of money.

Deliverability
The rate at which gas can be supplied from a reservoir – such as salt cavity storage – in a given period. In a salt cavity storage facility, for example, the rate would depend on a number of factors, including reservoir pressure, reservoir rock characteristics and withdrawal facilities such as pipeline capacity. The term is also used for the volume of gas that a field, pipeline, well, storage or distribution system can supply in a single 24-hour period.

Delivery
The term has distinct meaning when used in connection with futures contracts. Delivery generally refers to the changing of ownership or control of a commodity under specific terms and procedures established by the exchange upon which the contract is traded. Typically, except for energy, the commodity must be placed in an approved warehouse, precious metals depository, or other storage facility, and be inspected by approved personnel, after which the facility issues a warehouse receipt, shipping certificate, demand certificate, or due bill, which becomes a transferable delivery instrument. Delivery of the instrument is usually preceded by a notice of intention to deliver. After receipt of the delivery instrument, the new owner typically can take possession of the physical commodity, can deliver the delivery instrument into the futures market in satisfaction of a short position, or can sell the delivery instrument to another market participant who can use it for delivery into the futures market in satisfaction of his short position or for cash, or can take delivery of the physical himself. The procedure differs for energy contracts. Bona fide buyers or sellers of the underlying energy commodity can stand for delivery. If a buyer or seller stands for delivery, the contract is held through the termination of trading. The buyer and seller each file a notice of intent to make or take delivery with their respective clearing members, who file them with the Exchange. Buyers and sellers are randomly matched by the Exchange. The delivery payment is based on the contract’s final settlement price.

Delivery capacity
The maximum rate at which a natural gas buyer can request the seller to deliver gas (other than excess gas) into the pipeline and which the seller has a firm obligation to deliver. In peak-supply contracts, there may be a charge payable in respect of the available delivery capacity.

Delivery point
A point on the grid where one electric utility can transfer its available energy to another utility’s system.

Demand day
The level of demand over a 24-hour period.

Demand forecast
An estimate of future requirements or an estimate of energy requirements for a given future interval. 

Demand options
Voluntary measures that a utility or energy customer can take to alter either their total energy requirement or their pattern of energy use (load shape). These options can include rate structures such as time-of-use pricing that penalize heavy use of energy during peak demand periods and reward off-peak use, and enforcement of conservation standards by the utility or adoption of conservation practices by consumers, among others.

Demurrage
The cost, or the delay period resulting in the cost, charged when a vessel fails to unload or load within the allotted time period, or laytime, provided by contract. Essentially a liquidating damages charge for contract breach for detention of the ship.

Depleted resources
Resources that have been mined; include coal recovered, coal lost in mining, and coal reclassified as subeconomic because of mining.

Depleted storage field:
A sub-surface natural geological reservoir, usually a depleted gas or oil field, used for storing natural gas.

Depletion (coal)
The subtraction of both tonnage produced and the tonnage lost to mining from identified resources to determine the remaining tonnage as of a certain time.

Depletion factor
The multiplier applied to the tonnage produced to compute depletion. This multiplier takes into account both the tonnage recovered and the tonnage lost due to mining. The depletion factor is the reciprocal of the recovery factor in relation to a given quantity of production.

Depository or warehouse
A document issued by a bank or warehouse indicating ownership of a commodity stored in a bank depository or warehouse. In the case of many commodities deliverable against futures contracts, transfer of ownership of an appropriate depository receipt may affect contract delivery.

Depreciation
Another word for Amortization, which means the depreciation, depletion, or charge-off to expense of intangible and tangible assets over a period of time. In the extractive industries, the term is most frequently applied to mean either (1) the periodic charge-off to expense of the costs associated with non-producing mineral properties incurred prior to the time when they are developed and entered into production or (2) the systematic charge-off to expense of those costs of productive mineral properties (including tangible and intangible costs of prospecting, acquisition, exploration, and development) that had been initially capitalized (or deferred) prior to the time the properties entered into production, and thereafter are charged off as minerals are produced.

Depreciation and amortization of property, plant, and equipment
The monthly provision for depreciation and amortization (applicable to utility property other than electric plant, electric plant in service, and equipment).

Deregulation
The relaxation, reduction or complete removal of legislated restrictions from an industry or industry sector whose activities were previously under strict government supervision.

Desulfurization
The removal of sulfur, as from molten metals, petroleum oil, or flue gases.

Diesel fuel
A fuel composed of distillates obtained in petroleum refining operation or blends of such distillates with residual oil used in motor vehicles. The boiling point and specific gravity are higher for diesel fuels than for gasoline.

Direct current
The unidirectional flow of electric charge. High-voltage DC is a technique often used for undersea cables connecting different countries. Power transmitted in this way suffers less reactive power loss than an alternating current line. It also allows connection of two asynchronous alternating current networks. 

Dispatch
To control flow and direction. Energy dispatch controls how much energy travels through specific transmission stations to end-use service areas. Energy dispatch requires a human operator to schedule, monitor and control distribution of energy. The process of coordinating the distribution of energy on a moment-to-moment basis to meet changing load requirements.

Dispatchable generation
Generation available physically or contractually to respond to changes in system demand or to respond to transmission security constraints.

Displacement
Where natural gas is input into a pipeline system at one end and the same amount of gas is delivered at another point, although the gas may not have been transported between the two points.

Disposition, natural gas
The removal of natural, synthetic, and/or supplemental gas, or any components or gaseous mixtures contained therein, from the responding company’s facilities within the report State by any means or for any purpose, including the transportation of such gas out of the report State.

Disposition, petroleum
A set of categories used to account for how crude oil and petroleum products are transferred, distributed, or removed from the supply stream. The categories include stock change, crude oil losses, refinery inputs, exports, and products supplied for domestic consumption.

Distillate fuel oil
A general classification for one of the petroleum fractions produced in conventional distillation operations. It includes diesel fuels and fuel oils. Products known as No. 1, No. 2, and No. 4 diesel fuel are used in on-highway diesel engines, such as those in trucks and automobiles, as well as off-highway engines, such as those in railroad locomotives and agricultural machinery. Products known as No. 1, No. 2, and No. 4 fuel oils are used primarily for space heating and electric power generation.

  • No. 1 Distillate: A light petroleum distillate that can be used as either a diesel fuel (see No. 1 Diesel Fuel) or a fuel oil. See No.1 Fuel Oil .
  • No. 1 Diesel Fuel: A light distillate fuel oil that has distillation temperatures of 550 degrees Fahrenheit at the 90-percent point and meets the specifications defined in ASTM Specification D 975. It is used in high-speed diesel engines, such as those in city buses and similar vehicles.
  • No. 1 Fuel Oil: A light distillate fuel oil that has distillation temperatures of 400 degrees Fahrenheit at the 10-percent recovery point and 550 degrees Fahrenheit at the 90-percent point and meets the specifications defined in ASTM Specification D 396. It is used primarily as fuel for portable outdoor stoves and portable outdoor heaters.
  • No. 2 Distillate: A petroleum distillate that can be used as either a diesel fuel or a fuel oil.
  • No. 2 Diesel Fuel: A fuel that has distillation temperatures of 500 degrees Fahrenheit at the 10-percent recovery point and 640 degrees Fahrenheit at the 90-percent recovery point and meets the specifications defined in ASTM Specification D 975. It is used in high-speed diesel engines, such as those in railroad locomotives, trucks, and automobiles.
  • Low Sulfur No. 2 Diesel Fuel
  • No. 4 Fuel: A distillate fuel oil made by blending distillate fuel oil and residual fuel oil stocks. It conforms with ASTM Specification D 396 or Federal Specification VV-F-815C and is used extensively in industrial plants and in commercial burner installations that are not equipped with preheating facilities. It also includes No. 4 diesel fuel used for low- and medium-speed diesel engines and conforms to ASTM Specification D 975.
  • No. 4 Diesel Fuel and No. 4 Fuel Oil: See No. 4 Fuel.

Distillates
Oil products obtained by distillation, including gases, gasoline, naphtha’s, jet fuel, gasoil and waxy distillates. Atmospheric distillates boil at around 370° Celsius, and vacuum distillates at between 370° and 525°C.

Distillation
The simple refining of oil by boiling.

Distribution

  1. The probability distribution of a variable describes the probability of the variable attaining a certain value. The distribution assumed by an option pricing model is crucial to that model’s predictions, since it determines the likelihood of the option being exercised.
  2. The delivery of electricity to the retail customer’s home or business from the main grid through low-voltage distribution lines. Low voltages range from 2,300 to 69,000 volts.

Distribution system
The portion of the transmission and facilities of an electric system that is dedicated to delivering electric energy to an end-user.

Distributor
A company primarily engaged in the sale and delivery of natural and/or supplemental gas directly to consumers through a system of mains.

Downstream
Activities in the oil and natural gas industry from a refinery onwards – for example, the distribution and marketing of hydrocarbon products.

Drilling and equipping of wells
The drilling and equipping of wells through completion of the “Christmas tree.”

Drilling arrangement
A contractual agreement under which a working interest owner (assignor) assigns a part of a working interest in a property to another party (the assignee) in exchange for which the assignee agrees to develop the property. The term may also be applied to an agreement under which an operator assigns fractional shares in production from a property to participants for cash considerations as a means of acquiring cash for developing the property. Under a “disproportionate cost” drilling arrangement, the participants normally pay a greater total share of costs than the total value of the fractional shares of the property received in the arrangement.

Dry (coal) basis
Coal quality data calculated to at theoretical basis in which no moisture is associated with the sample. This basis is determined by measuring the weight loss of a sample when its inherent moisture is driven off under controlled conditions of low temperature air-drying followed by heating to just above the boiling point of water (104 to 110 degrees Centigrade).

Dry hole
An exploratory or development well found to be incapable of producing either oil or gas in sufficient quantities to justify completion as an oil or gas well.

Dry hole charge
The charge-off to expense of a previously capitalized cost upon the conclusion of an unsuccessful drilling effort.

Dry hole contribution
A payment (either in cash or acreage) that is required by agreement only if a test well is unsuccessful and that is made in exchange for well test and evaluation data.

Dry natural gas
Natural gas which remains after: 1) the liquefiable hydrocarbon portion has been removed from the gas stream (i.e., gas after lease, field, and/or plant separation); and 2) any volumes of nonhydrocarbon gases have been removed where they occur in sufficient quantity to render the gas unmarketable. Note: Dry natural gas is also known as consumer-grade natural gas. The parameters for measurement are cubic feet at 60 degrees Fahrenheit and 14.73 pounds per square inch absolute.

Dry natural gas production
The process of producing consumer-grade natural gas. Natural gas withdrawn from reservoirs is reduced by volumes used at the production (lease) site and by processing losses. Volumes used at the production site include (1) the volume returned to reservoirs in cycling, repressuring of oil reservoirs, and conservation operations; and (2) gas vented and flared. Processing losses include (1) nonhydrocarbon gases (e.g., water vapor, carbon dioxide, helium, hydrogen sulfide, and nitrogen) removed from the gas stream; and (2) gas converted to liquid form, such as lease condensate and plant liquids. Volumes of dry gas withdrawn from gas storage reservoirs are not considered part of production. Dry natural gas production equals marketed production less extraction loss.

DTe
Directie Toezicht energie – Energy Regulation Service. The body is part of NMA (Netherlands Competition Authority) and is employed in ensuring energy markets function as well as possible.

Dual-fired unit
A generating unit that can produce electricity using two or more input fuels. In some of these units, only the primary fuel can be used continuously; the alternate fuel(s) can be used only as a start-up fuel or in emergencies.

Dual-firing
Where two different fuels – say, gas and oil – can be used to generate energy in one piece of equipment.

Dubai
A benchmark crude produced in Dubai, one of the United Arab Emirates. Dubai is commonly used as a reference price for the Asia-Pacific region.

E

E95
A fuel containing a mixture of 95 percent ethanol and 5 percent gasoline

E&P
Exploration and production.

EBN
Energie Beheer Nederland – Energy Management Netherlands, which is 100% owned by the Dutch state.

EC
The European Commission embodies and promotes the interests of the European Union. The Commission has its seat in Brussels.

ECN
The Energieonderzoek Centrum Nederland – Energy Research Centre – is the largest Dutch research centre in the field of energy.

Economic dispatch
A method of managing the operation (dispatching) of generation and transmission facilities to produce the most cost-effective result. Economic dispatch most commonly involves the selection of the lowest-cost available generating units or fuels for powering available units.

Economy of scale
The principle that larger production facilities have lower unit costs than smaller facilities.

EDCQ
(Gas) estimated daily contract quantity.

Effective full-power days
The number of effective full-power days produced by a unit is a measure of the unit’s energy generation. It is determined using the following ratio Heat generation (planned or actual) in megawatt days thermal (MWdt) (divided by) Licensed thermal power in megawatts thermal (MWt).

EFS
Exchange of futures for swaps

EFET Master Agreement
A standardized master agreement developed by the European Federation of Energy Traders for the delivery and acceptance of electricity, providing a similar structure to the International Swaps and Derivatives Association by containing a General Agreement and Election Sheet for agreed revisions to the General Agreement.
www.efet.org

EIA
Energy Information Administration

Electric current
The flow of electric charge. The preferred unit of measure is the ampere.

Electric energy
The ability of an electric current to produce work, heat, light, or other forms of energy. It is measured in kilowatt-hours.

Electric generator
A facility that produces only electricity, commonly expressed in kilowatt-hours (kWh) or megawatt hours (MWh). Electric generators include electric utilities and independent power producers.

Electric operating expenses
Summation of electric operation-related expenses, such as operation expenses, maintenance expenses, depreciation expenses, amortization, taxes other than income taxes, Federal income taxes, other income taxes, provision for deferred income taxes, provision for deferred income-credit, and investment tax credit adjustment.

Electric plant (physical)
A facility containing prime movers, electric generators, and auxiliary equipment for converting mechanical, chemical, and/or fission energy into electric energy.

Electric power
The rate at which electric energy is transferred. Electric power is measured by capacity and is commonly expressed in megawatts (MW).

Electric power grid
A system of synchronized power providers and consumers connected by transmission and distribution lines and operated by one or more control centers. In the continental United States, the electric power grid consists of three systems the Eastern Interconnect, the Western Interconnect, and the Texas Interconnect. In Alaska and Hawaii, several systems encompass areas smaller than the State (e.g., the interconnect serving Anchorage, Fairbanks, and the Kenai Peninsula; individual islands).

Electric power plant
A station containing prime movers, electric generators, and auxiliary equipment for converting mechanical, chemical, and/or fission energy into electric energy.

Electric power trading day
For trading purposes in designating hours traded, the 24-hour period beginning at midnight and ending at the following midnight.

Electric system reliability
The degree to which the performance of the elements of the electrical system results in power being delivered to consumers within accepted standards and in the amount desired. Reliability encompasses two concepts, adequacy and security. Adequacy implies that there are sufficient generation and transmission resources installed and available to meet projected electrical demand plus reserves for contingencies. Security implies that the system will remain intact operationally (i.e., will have sufficient available operating capacity) even after outages or other equipment failure. The degree of reliability may be measured by the frequency, duration, and magnitude of adverse effects on consumer service.

Electric utility
A corporation, person, agency, authority, or other legal entity or instrumentality aligned with distribution facilities for delivery of electric energy for use primarily by the public. Included are investor-owned electric utilities, municipal and State utilities, Federal electric utilities, and rural electric cooperatives. A few entities that are tariff based and corporately aligned with companies that own distribution facilities are also included.

Electric utility generator
A generator that is owned by an electric utility or a jointly owned generator with the greatest share of the generator being electric utility owned. Note: If two or more owners have equal shares of ownership in a generator, it is considered to be an electric utility generator if any one of the owners meets the definition of electric utility.

Electric utility sector
The electric utility sector consists of privately and publicly owned establishments that generate, transmit, distribute, or sell electricity primarily for use by the public and that meet the definition of an electric utility. Non utility power producers are not included in the electric sector.

Electric zone
A portion of the grid controlled by the independent system operator.

Electrical system energy losses
The amount of energy lost during generation, transmission, and distribution of electricity, including plant and unaccounted for use.

Electricity
A form of energy characterized by the presence and motion of elementary charged particles generated by friction, induction, or chemical change.

Electricity forward market
A brokered over-the-counter market in the UK for short- to medium-term electricity derivative instruments, of which the most widely used is the electricity forward agreement.

Electricity generation, gross
The total amount of electric energy produced by the generating station or stations, measured at the generator terminals.

Electricity generation, net
Gross generation less electricity consumed at the generating plant for station use. Electricity required for pumping at pumped-storage plants is regarded as plant use and is deducted from gross generation. 

Electricity utility
An enterprise engaged in the generation, transmission and/or distribution of electricity primarily for use by the public, which is the major power supplier within a designated service area. Electricity utilities include investor owned, publicly owned, co-operatively-owned and government-owned entities.

Emergency backup generation
The use of electric generators only during interruptions of normal power supply.

Emergency energy
Electric energy provided for a limited duration, intended only for use during emergency conditions.

Emission(s)
Substance(s) or pollutant emitted as a result of a process.

Emissions coefficient
A unique value for scaling emissions to activity data in terms of a standard rate of emissions per unit of activity (e.g., pounds of carbon dioxide emitted per Btu of fossil fuel consumed).

Emissions credits
The instruments created by regulations in the US market to encourage market-driven reductions of pollution.

Emissions trading
Emissions trading is a market-based approach in order to achieve climate protection goals. The sale of emission allowances to a higher price than an emission reduction action would cost, or the purchase of emission  allowances in case of higher costs of emission reduction actions, provides an incentive for companies to engage in emission trading. Due to the limited amount of allocated emission allowances evolves a market in which also companies without emission reduction liabilities take part (cap and trade system).

Emission Reduction Unit (ERU)
ERU refers to the reduction of greenhouse gases, particularly under Joint Implementation, where it represents one tonne of CO2 equivalent reduced.

EnergieNed
EnergieNed, a federation of energy companies in the Netherlands, is the sector organization for all companies in the Netherlands involved in production, transport, trade or supply of gas, electricity and/or heating.

Energy Information Administration (EIA)
A US government agency that produces reports on US energy supply and demand, most notably a weekly report detailing crude and product inventories in various areas of the US. The report covers US refinery throughput, as well as crude and product imports and exports. Information is also provided on natural gas and electricity.

Energy Council
The Energy Council (or General Energy Council) is a Dutch governmental advisory body

Energy Efficiency
A ratio of service provided to energy input. Services provided can include buildings-sector end uses such as lighting, refrigeration, and heating: industrial processes; or vehicle transportation. Unlike conservation, which involves some reduction of service, energy efficiency provides energy reductions without sacrifice of service. May also refer to the use of technology to reduce the energy needed for a given purpose or service.

Energy efficiency (electricity)
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 megawatt hours), often without explicit consideration for the timing of program-induced savings. Such savings are generally achieved by substituting technologically 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 efficiency rating, energy efficiency ratio (EER)
A value that expresses the relative efficiency of devices that consume electricity, more specifically devices that produce heat.

Energy exchange
Any transaction in which quantities of energy are received or given up in return for similar energy products.

Energy Intensity
A ratio of energy consumption to another metric, typically national gross domestic product in the case of a country’s energy intensity. Sector-specific intensities may refer to energy consumption per household, per unit of commercial floor space, per dollar value industrial shipment, or another metric indicative of a sector. Improvements in energy intensity include energy efficiency and conservation as well as structural factors not related to technology or behavior.

Energy intensity (Commercial Buildings Energy Consumption Survey)
The ratio of consumption to floor space.

Energy supply
Energy made available for future disposition. Supply can be considered and measured from the point of view of the energy provider or the receiver.

Energy Loss
Energy lost or wasted in the transmission of energy from the generator to the eventual customer.

Endex
European energy derivatives exchange, part, of APX-Endex, strongly aimed at the Benelux countries.

Enriched uranium
Uranium in which the U-235 isotope concentration has been increased to greater than the 0.711 percent U-235 (by weight) present in natural uranium.

Enrichment feed deliveries
Uranium that is shipped under contract to a supplier of enrichment services for use in preparing enriched uranium product to a specified U-235 concentration and that ultimately will be used as fuel in a nuclear reactor.

Enrichment tails assay
A measure of the amount of fissile uranium (U-235) remaining in the waste stream from the uranium enrichment process. The natural uranium “feed” that enters the enrichment process generally contains 0.711 percent (by weight) U-235. The “product stream” contains enriched uranium (more than 0.711 percentU-235) and the “waste” or “tails” stream contains depleted uranium (less than 0.711 percent U-235). At the historical enrichment tails assay of 0.2 percent, the waste stream would contain 0.2 percent U-235. A higher enrichment tails assay requires more uranium feed (thus permitting natural uranium stockpiles to be decreased), while increasing the output of enriched material for the same energy expenditure.

ERGEG
European Regulators Group for Electricity and Gas: Coordinating organization of Europe’s regulators in the field of gas and electricity.

Ethane (C2H6)
A normally gaseous straight-chain hydrocarbon. It is a colorless paraffinic gas that boils at a temperature of-88.60 degrees Celsius. It is extracted from natural gas and refinery gas streams.

Ethanol (C2H5OH)
A clear, colorless, flammable alcohol. Ethanol is typically produced biologically from biomass feedstocks such as agricultural crops and cellulosic residues from agricultural crops or wood. Ethanol can also be produced chemically from ethylene.

Ether
A generic term applied to a group of organic chemical compounds composed of carbon, hydrogen, and oxygen, characterized by an oxygen atom attached to two carbon atoms (e.g., methyl tertiary butyl ether).

Ethylene
An olefinic hydrocarbon recovered from refinery processes or petrochemical processes. Ethylene is used as a petrochemical feedstock for numerous chemical applications and the production of consumer goods.

Ethylene dichloride
A colorless, oily liquid used as a solvent and fumigant for organic synthesis, and for ore flotation.

EU
The European Union is a collaboration of 27 European countries. Collaboration takes place in the fields of politics, economy and law.

EUA
EUA is the abbreviation for EU Allowance. One EUA is the minimum trading unit in EU emissions trading. One EU allowance enables the owner to emit one tonne CO2 equivalent.

Eurasia
The physical land mass containing the continents of Europe and Asia. For Energy Information Administration reporting, it includes the former parts of the Union of Soviet Socialist Republics (U.S.S.R.): Armenia, Azerbaijan, Belarus, Estonia, Georgia, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan.

Euro hub
The Euro hub was an inter-connector in South Limburg which was set up as a gas trading place for various large international energy traders. It closed in 2006 and was the forerunner of TTF.

European Commodity Clearing AG (ECC)
Central counterparty for all transactions effected on EEX.

European Emissions Allowances (EUA)
Represents a permit to emit one tonne of  carbon under the European Union Emissions Trading System. Since one EU Allowance Unit of one tonne of CO2, or ‘EUA’, is equivalent to one ‘assigned amount unit’ of CO2 defined under Kyoto, it is possible to trade EAUs and United Nations Framework Convention on Climate Change-validated CERs on a one-tone basis within the same system.

European Federation of Energy Traders (EFET)
EFET is a group of more than 90 energy trading companies from 23 European countries dedicated to improving conditions for energy trading in Europe and providing an exchange for non-commercially sensitive information between organizations and members of the developing pan-European energy industry. EFET is complementary to existing industry organizations in European organizations as it is solely dedicated to energy trading issues.
www.efet.org

European Regulators’ Group for Electricity and Gas (ERGEG)
ERGEG is an advisory group of independent national regulatory authorities. ERGEG was established on 11 November, 2003, pursuant to Directive 2003/796/EC, to assist the Commission in consolidating the internal market for electricity and gas. Its members are the heads of the national energy regulatory authorities in the 27 EU Member States.
www.energy-regulators.eu

European Transmission System Operators (ETSO)
Was created following the development of the Internal Electricity Market for the EU, as an association to support EU-wide harmonization of network access and conditions for usage, especially for cross-border electricity trading. The networks represented by ETSO supply more than 490 million people with electric energy. The consumption of electric energy amounts to approx. 3,200TWh per year. The length of HV (400 and 22 0kV) lines covered by ETSO exceeds 290,000km.
www.etso-net.org

European Union (EU)
The EU is an organization of 27 Member States designed to promote economic and social progress. Through its executive body, the European Commission, the EU makes policy that is legally binding in its Member States.

Evacuated-tube collector
A collector in which solar thermal heat is captured by use of a collector fluid that flows through an absorber tube contained inside an evacuated glass tube.

Evaporation pond
A containment pond (that preferably has an impermeable lining of clay or synthetic material such as hypalon) to hold liquid wastes and to concentrate the waste through evaporation.

Excess cargo
As used in the liquefied natural gas (LNG) market, the cargoes in excess of long-term contracted quantities of LNG, which are typically either offered to existing long-term buyers or alternatively auctioned in the spot market.

Excess gas
A natural gas buyer may ask the seller to deliver above the delivery capacity rate. The seller does not have to do so but, if it does, the buyer will pay a premium over the main contract price.

Exchange of futures for physicals
The conversion of a futures position into a physical position via simultaneous buy/sell transactions. Also referred to as exchange of futures for product.

Exchange of futures for swaps (EFS)
The conversion of a futures position into a swaps position via simultaneous buy/sell transactions.

Exploration drilling
Drilling done in search of new mineral deposits, on extensions of known ore deposits, or at the location of a discovery up to the time when the company decides that sufficient ore reserves are present to justify commercial exploration. Assessment drilling is reported as exploration drilling.

Exposure
The amount that is exposed to potential danger: the amount of risk.

Ex-ship
A shipping delivery provision whereby cargo responsibility and risk resides with the shipper until the ship has arrived at designated port and cargo is available for delivery.

F

Facilities charge
An amount to be paid by the customer in a lump sum, or periodically as reimbursement for facilities furnished. The charge may include operation and maintenance as well as fixed costs.

Facility
An existing or planned location or site at which prime movers, electric generators, and/or equipment for converting mechanical, chemical, and/or nuclear energy into electric energy are situated, or will be situated. A facility may contain more than one generator of either the same or different prime mover type. For a co generator, the facility includes the industrial or commercial process. 

Fade down
Reducing a power plant’s production. The more a plant is faded down, the less production capacity is utilized. At total fade down, the plant will generate no production at all.

Fade up
The increasing of a power plant’s production, as a result of which production capacity is better utilized.

Fahrenheit
A temperature scale on which the boiling point of water is at 212 degrees above zero on the scale and the freezing point is at 32 degrees above zero at standard atmospheric pressure.

Farm out (in) arrangement
An arrangement, used primarily in the oil and gas industry, in which the owner or lessee of mineral rights (the first party) assigns a working interest to an operator (the second party), the consideration for which is specified exploration and/or development activities. The first party retains an overriding royalty or other type of economic interest in the mineral production. The arrangement from the viewpoint of the second party is termed a “farm-in arrangement.”

FcFs (First come, First served)
The operator allots capacity to market participants on the ‘first come, first served’ principle. In order of application and on a non-discriminatory basis, GTS sells ‘firm’ capacity in advance. If firm capacity is eventually not allocated or utilized, owners of ‘interruptible’ capacity may still utilize the unused capacity.

Feedstocks
Crude products, natural gas, chemicals or raw material used in a refinery, liquefied natural gas liquefaction plant, or petrochemical plant for processing into a finished output product or products.

Final day-ahead schedule
Once an independent system operator’s schedule for the next day’s energy transmission has been checked with neighboring ISOs, the result is called a final day-ahead schedule. ISOs have the power to schedule the management and use of the transmission grid or network under their control, but they must also arrange with other ISOs to guard against congestion and ensure coordinated, efficient delivery of energy for the following day.

Financial Accounting Standards Board (FASB)
An independent board responsible, since 1973, for establishing generally accepted accounting principles. Its official pronouncements are called “Statements of Financial Accounting Standards” and “Interpretations of Financial Accounting Standards.”

Firm capacity
An amount of natural gas in a buyer’s contract that is guaranteed not to be interrupted, or a liquefied natural gas (LNG) terminal access capacity contractually guaranteed by the terminal operator or guaranteed capacity by LNG shippers or sellers.

Firm energy
Electricity transmission service offered to customers under a filed rate schedule that anticipates no planned interruption.

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.

Firm service
Gas or electricity sales that are guaranteed not to be interrupted.

Firm (uninterrupted)
Natural gas for which the full price has been paid on the understanding it will be delivered continually through the contract period.

Flared
Natural gas that is disposed of by burning.

Flexibility bid
In the gas market, where the system needs to buy or sell gas to keep it in balance, a shipper may put in a flexibility bid. The shipper specifies whether it is a buy or sell, the date or dates to which it applies, the amount of gas, the calorific value of the input gas, how quickly it could be implemented, how and where it would be implemented and the price.

Floor (coal)
The upper surface of the stratum underlying a coal seam. In coals that were formed in persistent swamp environments, the floor is typically a bed of clay, known as “underclay,” representing the soil in which the trees or other coal-forming swamp vegetation was rooted.

Floor price
A price specified in a market-price contract as the lowest purchase price of the uranium, even if the market price falls below the specified price. The floor price may be related to the seller’s production costs.

Fly ash
Particulate matter mainly from coal ash in which the particle diameter is less than 1 x 104 meter. This ash is removed from the flue gas using flue gas particulate collectors such as fabric filters and electrostatic precipitators.

FOB
Free-on-board.

F.o.b. price
The price actually charged at the producing country’s port of loading. The reported price should be after deducting any rebates and discounts or adding premiums where applicable and should be the actual price paid with no adjustment for credit terms.

F.o.b. value (coal)
Free-on-board value. This is the value of coal at the coal mine or of coke and breeze at the coke plant without any insurance or freight transportation charges added.

Footage drilled
Total footage for wells in various categories, as reported for any specified period, includes (1)the deepest total depth (length of well bores) of all wells drilled from the surface, (2) the total of all bypassed footage drilled in connection with reported wells, and (3) all new footage drilled for directional sidetrack wells. Footage reported for directional side-track wells does not include footage in the common bore that is reported as footage for the original well. In the case of old wells drilled deeper, the reported footage is that which was drilled below the total depth of the old well.

Force majeure
A contract clause that allows the supplier to forego his obligation to supply in extreme circumstances, such as a political crisis, war or strikes that disturb production. It also applies to a buyer that is unable to take delivery of product – for example, a refiner whose refinery is shut down following a fire or disaster.

Forced outage
A hardware failure at some point in the production, transmission, or distribution system that results in interruption of service. Forced outages usually occur due to unexpected component failure or systemic problems such as downed lines or lightning-induced overloads. These outages may or may not affect an endues customer depending on where they occur. Regularly-scheduled shutdowns of equipment for routine maintenance do not qualify as forced outages.

Forward
A contract used for trading commodities that will be delivered to the buyer at a specified time in the future. Forwards differ from futures in that they are usually customized for the buyer, they are not traded on exchanges, and they may not be subject to the same regulations as futures.

Forward buying
The acquisition of energy or related services in advance of need. Used primarily to ensure continuous, uninterrupted service by insuring future supplies of energy and availability of transmission access and other needed delivery services.

Forward freight agreement (FFA)
FFAs are derivatives instruments used to hedge risk in the tanker freight sector.

Fossil fuel
An energy source formed in the Earth RSQUO’s crust from decayed organic material. The common fossil fuels are petroleum, coal, and natural gas.

Fossil fuel plant
A plant using coal, petroleum, or gas as its source of energy.

Fossil fuel steam-electric power plant
An electricity generation plant in which the prime mover is a turbine rotated by high-pressure steam produced in a boiler by heat from burning fossil fuels.

Fossil-fuel electric generation
Electric generation in which the prime mover is a turbine rotated by high-pressure steam produced in a boiler by heat from burning fossil fuels.

Fraction
Component of a mixture. The term fraction is chiefly used if the component can be separated from the mix by means of an isolating method, like refining through distillation or filtration.

Fractionation
The process by which saturated hydrocarbons are removed from natural gas and separated into distinct products, or “fractions,” such as propane, butane, and ethane.

Framework Convention on Climate Change (FCCC)
An agreement opened for signature at the “Earth Summit” in Rio de Janeiro, Brazil, on June 4, 1992, which has the goal of stabilizing greenhouse gas concentrations in the atmosphere at a level that would prevent significant anthropogenically forced climate change.

Free alongside ship (f.a.s.)
The value of a commodity at the port of exportation, generally including the purchase price plus all charges incurred in placing the commodity alongside the carrier at the port of exportation.

Free-on-board (FOB)
Under an FOB contract, the seller provides the crude oil, oil product or liquefied natural gas at a lifting installation, so that all loading costs to put the commodity on board a carrier have been paid, but the buyer takes responsibility for shipping and freight insurance.

Freight derivatives
Derivatives instruments used to hedge risk in the tanker freight markets. Tankers are one of the most common means of transporting commodities such as oil and coal. Freight derivatives, such as swaps or forward freight agreements, can be used to protect ship owners against changes in freight rates.

Frequency
The number of cycles per second of electromagnetic waves, as measured in hertz.

Fuel cell
A device that converts fuel energy to electrical energy by means of an electrochemical process. Fuel cells chemically combine the molecules of a fuel (most commonly hydrogen) and an oxidizer (for example air) to create heat without burning, thereby reducing the thermal inefficiencies and pollution that characterize traditional means of combustion.

Fuel purchase agreement
An agreement between a company and a fuel provider which stipulates that the company agrees to purchase its fuel from the fuel provider. If the company has a credit card for use at a fuel provider’s locations, but is not bound by an additional agreement to purchase fuel from that provider, the credit card agreement alone is not considered a fuel purchase agreement.

Fuel switching capability
The short-term capability of a manufacturing establishment to have used substitute energy sources in place of those actually consumed. Capability to use substitute energy sources means that the establishment’s combustors (for example, boilers, furnaces, ovens, and blast furnaces) had the machinery or equipment either in place or available for installation so that substitutions could actually have been introduced within 30 days without extensive modifications. Fuel-switching capability does not depend on the relative prices of energy sources; it depends only on the characteristics of the equipment and certain legal constraints.

Futures contract
When an agreement is made to acquire goods or services on the futures market, the buyer and seller enter into a futures contract. This contract assures the seller that the buyer will pay the agreed-upon price for a predetermined quantity of the commodity. In return, the buyer can lock in a price for the commodity regardless of the market price when the commodity is delivered. Technically speaking, when a purchase is made on the futures market, the only thing bought or sold is the contract. Since the seller doesn’t sell the commodity until the date on the contract, no actual commodity is sold under the contract until that date.

Futures market
A commodities market where delivery of not-yet-produced goods or services are purchased and sold using auction or stock-market-style bidding procedures.

G

GAAP
Generally Accepted Accounting Principles

Gal
Gallon

Gallon
A volumetric measure equal to 4 quarts (231 cubic inches) used to measure fuel oil. One barrel equals 42 gallons.

Gas
Natural gas covers a range of gases that occur naturally and are composed mainly of methane (CH4) and ethane. In the UK gas supply industry, it refers to the gas supplied through the mains system (mainly CH4). North Sea gas usually has a declared heating value of 1,035 British thermal units per cubic foot.

Gas nominations
Nomination deadlines are where each pipeline has a scheduled deadline before which shippers must book gas for the following month.

Gas plant operator
Any firm, including a gas plant owner, which operates a gas plant and keeps the gas plant records. A gas plant is a facility in which natural gas liquids are separated from natural gas or in which natural gas liquids are fractionated or otherwise separated into natural gas liquid products or both.

Gas processing unit
A facility designed to recover natural gas liquids from a stream of natural gas that may or may not have passed through lease separators and/or field separation facilities. Another function of natural gas processing plants is to control the quality of the processed natural gas stream. Cycling plants are considered natural gas processing plants.

Gas to liquids (GTL)
A process that combines the carbon and hydrogen elements in natural gas molecules to make synthetic liquid petroleum products, such as diesel fuel.

Gas Transport Services
GTS is the Dutch national transmission-system operator and a full subsidiary of Gasunie.

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 and 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 drive the generator and are then used to run the compressor.

Gas year
In the UK, the gas year begins at 06:00 on October 1. This is also known as the contract year, as it is when purchase contracts begin.

Gas well
A well completed for production of natural gas from one or more gas zones or reservoirs. Such wells contain no completions for the production of crude oil.

Gasification
A method for converting coal, petroleum, biomass, wastes, or other carbon-containing materials into a gas that can be burned to generate power or processed into chemicals and fuels.

Gasoil
European and Asian designation for No. 2 heating oil and No. 2 diesel fuel.

Gasoline
Motor gasoline (finished)

Gasoline blending components
Naphtha’s which will be used for blending or compounding into finished aviation or motor gasoline (e.g., straight-run gasoline, alkylate, reformate, benzene, toluene, andxylene). Excludes oxygenates (alcohols, ethers), butane, and pentanes plus.

Gasoline grades
The classification of gasoline by octane ratings. Each type of gasoline (conventional, oxygenated, and reformulated) is classified by three grades – Regular, Midgrade, and Premium. Note: Gasoline sales are reported by grade in accordance with their classification at the time of sale. In general, automotive octane requirements are lower at high altitudes. Therefore, in some areas of the United States, such as the Rocky Mountain States, the octane ratings for the gasoline grades may be 2 or more octane points lower.

  • Regular gasoline: Gasoline having an antiknock index, i.e., octane rating, greater than or equal to 85 and less than 88. Note Octane requirements may vary by altitude.
  • Midgrade gasoline: Gasoline having an antiknock index, i.e., octane rating, greater than or equal to 88 and less than or equal to 90. Note: Octane requirements may vary by altitude.
  • Premium gasoline: Gasoline having an antiknock index, i.e., octane rating, greater than 90. Note: Octane requirements may vary by altitudes or fluids at various depths beneath the surface of the earth. The energy is extracted by drilling and/or pumping.

Gasoline motor, (leaded)
Contains more than 0.05 grams of lead per gallon or more than 0.005 grams of phosphorus per gallon. The actual lead content of any given gallon may vary. Premium and regular grades are included, depending on the octane rating. Includes leaded gasohol. Blendstock is excluded until blending has been completed. Alcohol that is to be used in the blending of gasohol is also excluded.

GasTerra
Split commercial enterprise of the former Gasunie. GasTerra is 40% owned by EBN, 10% by the Dutch government, 25% by Shell and 25% by ExxonMobil.

Gasunie
As trader and transporters, Netherlands Gasunie PLC monopolized the Dutch wholesale gas market from 1963 to 2005. The company was owned 25% by both Shell and ExxonMobil, 10% by the Dutch government and 40% by EBN. From 2005 to date, Netherlands Gasunie PLC is a construction company and project developer for the Dutch gas sector. The company is now 100% owned by the government and is also 100% parent company of GTS.

GDP
Gross Domestic Product.

Generally accepted accounting principles (GAAP)
Defined by the FASB as the conventions, rules, and procedures necessary to define accepted accounting practice at a particular time, includes both broad guidelines and relatively detailed practices and procedures.

Generating unit
The sum and total of all equipment necessary for production of electricity.

Generation
The act of producing energy, or the amount of energy produced. A facility’s energy output is often referred to as its generation.

Generation mix
The diversity of generating units used to produce electricity.

Generation scheduling
The planning and arranging of energy production. Schedules are usually drawn up in one-hour increments, but the increased sophistication of modern energy management systems allows production to be scheduled down to the minute if needed.

Geothermal energy
Energy derived from the heat of the earth’s core. Geothermal energy sources include steam, hot water or hot rocks lying close to the earth’s surface.

German Power Index
An electricity price index for the whole of Germany, launched by Dow Jones in January 2001. Created through the merger of the Central European Price Index and the Electricity Index South.

Global warming
Global warming is the progressive gradual rise of the earth’s surface temperature, thought by many scientists to be caused by the greenhouse effect and responsible for changes in global climate patterns.

Global warming potential (GWP)
An index used to compare the relative radiative forcing of different gases without directly calculating the changes in atmospheric concentrations. GWPs are calculated as the ratio of the radiative forcing that would result from the emission of one kilogram of a greenhouse gas to that from the emission of one kilogram of carbon dioxide over a fixed period of time, such as 100 years.

GOS
The Netherlands has about 1,100 gas-capture plants. At a GOS, gas is injected into the national gas network or taken out of it. Bilateral trade only takes place at a GOS.

Green power
Any type of energy that is considered to have a lower environmental impact than commercially-produced energy.

Greenhouse effect
The idea that certain gases in the atmosphere trap heat like the glass in a greenhouse was first proposed over one hundred years ago, and is now widely accepted. About half the sun’s energy reaching the earth is reflected back into space or absorbed by the upper atmosphere. The other half is absorbed by the earth’s surface. Some of this energy is then radiated upwards where a portion is trapped in the atmosphere warming the Earth. The rest goes out into space. The greenhouse gases, primarily carbon dioxide and methane, control the balance between the trapped and radiated energy.

Greenhouse gases
A collection of gaseous substances, primarily consisting of carbon dioxide, methane and nitrogen oxides, which have been shown to warm the earth’s atmosphere by trapping solar radiation. Greenhouse gases include chlorofluorocarbons (CFCs), a group of chemicals used primarily in cooling systems and which are now either outlawed or severely restricted by most industrialized nations.

Grid
An electricity transmission system.

Grid operator
System operator

Groningen field
The largest continental gas field in Europe: it is spread out over a large part of the province of Groningen, but is also named after the town of Slochteren. The gas in the field is characterized by its low-calorie value (L-gas), and the field is characterized by low marginal production costs and its extreme flexibility in absorbing seasonal patterns (swing capacity).

Gross domestic product (GDP)
The total value of goods and services produced by labor and property located in the United States. As long as the labor and property are located in the United States, the supplier (that is, the workers and, for property, the owners) may be either U.S. residents or residents of foreign countries.

GWEC
Global Wind Energy Council.

H

Heat content
The amount of heat energy available to be released by the transformation or use of a specified physical unit of an energy form (e.g., a ton of coal, a barrel of oil, a kilowatt-hour of electricity, a cubic foot of natural gas, or a pound of steam). The amount of heat energy is commonly expressed in British thermal units(Btu). Note: Heat content of combustible energy forms can be expressed in terms of either gross heat content (higher or upper heating value) or net heat content (lower heating value), depending upon whether or not the available heat energy includes or excludes the energy used to vaporize water (contained in the original energy form or created during the combustion process). The Energy Information Administration typically uses gross heat content values.

Heat rate
A measure of how efficiently an electricity generator converts thermal energy into electricity and a key determinant of the spark spread. More precisely, the heat rate is the ratio of British thermal units of fuel consumed to kilowatt hours of electricity produced. Hence, the lower the heat rate, the higher the conversion efficiency.

Heating degree-days (HDD)
A measure of how cold a location is over a period of time relative to a base temperature, most commonly specified as 65 degrees Fahrenheit. The measure is computed for each day by subtracting the average of the day’s high and low temperatures from the base temperature (65 degrees), with negative values set equal to zero. Each day’s heating degree-days are summed to create a heating degree-day measure for a specified reference period. Heating degree-days are used in energy analysis as an indicator of space heating energy requirements or use.

Heating equipment
Any equipment designed and/or specifically used for heating ambient air in an enclosed space. Common types of heating equipment include: central warm air furnace, heat pump, plug-in or built-in room heater, boiler for steam or hot water heating system, heating stove, and fireplace. Note: A cooking stove in a housing unit is sometimes reported as heating equipment, even though it was built for preparing food.

Heating intensity
The ratio of space-heating consumption or expenditures to square footage of heated floor space and heating degree-days (base 65 degrees Fahrenheit). This ratio provides away of comparing different types of housing units and households by controlling for differences in housing unit size and weather conditions. The square footage of heated floor space is based on the measurements of the floor space that is heated. The ratio is calculated on a weighted, aggregate basis according to the following formula Heating Intensity =Btu for Space Heating / (Heated Square Feet * Heating Degree-Days).

Heating value
The average number of British thermal units per cubic foot of natural gas as determined from tests of fuel samples.

Heavy
Typically crude oil with an API gravity of less than 28 degrees.

Heavy gas oil
Petroleum distillates with an approximate boiling range from 651 degrees Fahrenheit to 1000 degrees Fahrenheit.

Heavy oil
Extremely syrupy crude oil, the liquidity of which is measured in API degrees.

Heavy metals
Metallic elements, including those required for plant and animal nutrition, in trace concentration but which become toxic at higher concentrations. Examples are mercury, chromium, cadmium, and lead.

Heavy oil
Extremely syrupy crude oil, the liquidity of which is measured in API degrees.

Henry Hub
The delivery point for the largest Nymex natural gas contract by volume. Henry Hub is in Erath, Louisiana, and is a large system of pipeline interconnects.

Heren
ICIS Heren is a world-leading publisher of gas, power and carbon market information. In 2008, ICIS, part of Reed Business Information UK, acquired Heren Energy (now ICIS Heren). www.heren.com

Hertz
A unit of frequency equal to one cycle per second and measured by changes in cycles or state.

HDD
Heating Degree-days

HHI index
The Herfindahl Hirschmann Index combines the squared sum of all the market shares of all suppliers and is an indicator for market concentration. A monopolistic market has a score of one hundred squared (10,000). A market with an index between 1,800 and 10,000 is regarded as concentrated.

Horsepower
A unit for measuring the rate of work (or power) equivalent to 33,000 foot-pounds per minute or 746 watts.

Hour-ahead market
As the term implies, the market for the electrical energy that can be delivered to the customer for use in the next hour.

Hydrocarbon
An organic chemical compound of hydrogen and carbon in the gaseous, liquid, or solid phase. The molecular structure of hydrocarbon compounds varies from the simplest (methane, a constituent of natural gas) to the very heavy and very complex.

Hydrocracking
Catalytic hydrocracking

Hydroelectric power
The use of flowing water to produce electrical energy.

Hydrogen
The lightest of all gases, occurring chiefly in combination with oxygen in water; exists also in acids, bases, alcohols, petroleum, and other hydrocarbons.

Hydropower
Electrical energy produced by flowing water. A hydroelectric power plant uses the movement of water to spin a turbine generator that produces electricity.

I

IAEA
The International Atomic Energy Agency is an United Nation’s organization focused on scientific and technical collaboration in the field of nuclear technology and its peaceful use. In total, 136 countries are members of the institute, which is based in Vienna.

IEA
International Energy Agency

Idle capacity
The component of operable capacity that is not in operation and not under active repair, but capable of being placed in operation within 30 days; and capacity not in operation but under active repair that can be completed within 90 days.

Imbalance (energy)
The difference between hourly scheduled electricity deliveries and hourly metered deliveries. Typically, energy imbalances are eliminated during a future period by returning energy in kind under conditions similar to those when the initial energy was delivered. When energy imbalances exceed a prespecified threshold (for example, +/–1.5% of the scheduled transaction), imbalances are resolved through monetary payments.

IMF
The International Monetary Fund is an institute that helps countries in financial need. Head Office of this ‘crisis manager’ is in Washington, USA. The IMF is a part of the United Nations and lends help under certain conditions. The IMF focuses on monetary collaboration and stability, monitoring economic growth, employment and exchange rate systems, and temporary financial help to correct deficits in the balance of payments.

Incremental cost
The cost of the next kilowatt-hour of generated energy, also referred to in the industry as the next unit.

Independent grid operator (IGO)
The party responsible for maintaining balance in a power grid. Grid operators control energy transmission systems and switching networks to ensure adequate energy flow in the grid by preventing excessive transmission or inconvenient reductions in current flow. Charged with maintaining the reliability of the grid. Independent power producer (IPP), non-utility generator (NUG). A producer of electrical energy which is not a public utility but which makes electric energy available for sale to utilities or the general public.

Independent power producer (IPP), non-utility generator (NUG)
A producer of electrical energy which is not a public utility but which makes electric energy available for sale to utilities or the general public.

Independent system operator (ISO)
(US) entity responsible for ensuring the efficient use and reliable operation of the transmission grid and, in some cases, generation facilities. Individual ISOs cover either a single state (e.g., the California ISO) or a region (e.g., the Midwest ISO). ISO responsibilities vary by jurisdiction, but can include coordinating scheduling for transmission transactions; overseeing the instantaneous balancing of generation and load; managing and redispatching generation in system emergencies; managing operating reserves; ensuring new transmission facilities are built when and where needed; and co-coordinating transmission payments. In some cases, ISOs are also responsible for managing power exchange activities.

Injection
The process of placing natural gas in underground storage or the producing reservoir in order to maintain pressure.

Intangible drilling and development costs (IDC)
Costs incurred in preparing well locations, drilling and deepening wells, and preparing wells for initial production up through the point of installing control valves. None of these functions, because of their nature, have salvage value. Such costs would include labor, transportation, consumable supplies, drilling tool rentals, site clearance, and similar costs.

Interchange
Energy that is sold by one utility to another is referred to as interchange. Interconnections, interconnects Points on a grid or network where two or more transmission lines join or cross, or where one stage of the energy supply chain meets the next. An interconnection can occur where a generating facility meets transmission facilities, where high-voltage energy transmission corridors cross, or where a utility’s distribution facilities connect with the transmission grid. These points can usually be switched or controlled to allow one line to receive more energy than another, or to transfer all energy on to one or more of the connecting lines.

Interconnection
Two or more electric systems having a common transmission line that permits a flow of energy between them. The physical connection of the electric power transmission facilities allows for the sale or exchange of energy.

Interconnector
A gas pipeline running from Bacton in Norfolk, England, to Zeebrugge in Belgium. It opened in October 1998 and allows Britain to export gas to, or import gas from, continental Europe for the first time.

Intergovernmental Panel on Climate Change (IPCC)
A panel established jointly in 1988 by the World Meteorological Organization and the United Nations Environment Program to assess the scientific information relating to climate change and to formulate realistic response strategies.

Internal rate of return (IRR)
A widely used rate of return for performing economic analysis. This method solves for the interest rate that equates the equivalent worth of an alternative’s cash receipts or savings to the equivalent worth of cash expenditures, including investments. The resultant interest rate is termed the internal rate of return (IRR).

International Energy Agency (IEA)
The International Energy Agency (IEA), based in Paris, is an intergovernmental organization that acts as energy policy adviser to 28 member countries. Founded during the oil crisis of 1973-74, the IEA’s initial role was to co-ordinate measures in times of oil supply emergencies. Its mandate has broadened to incorporate the ‘three Es’ of balanced energy policy making: energy security, economic development and environmental protection. Current work focuses on climate change policies, market reform, energy technology collaboration and energy research.

Interruptable capacity
Switchable capacity that is sold when all the ‘firm’ capacity has been bought. The cheaper ‘interruptible’ capacity can, on a switchable basis, be utilized if ‘firm’ capacity remains unused.

Interruptible energy
A type of electrical service sold to firms that might only be able to operate profitably when energy prices remain below a certain level. When interruptible energy is purchased, the purchaser voluntarily

assumes the risk of loss of access to that energy, which usually occurs only during peak demand periods or during periods when market prices rise above the agreed-upon rate. Commercial, industrial and agricultural customers tend to be the first affected by this type of interruption.

Interruptible gas
Gas sold to customers with a provision that permits curtailment or cessation of service at the discretion of the distributing company under certain circumstances, as specified in the service contract.

Interruptible load
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.

Interruptible power
Power and usually the associated energy made available by one utility to another. This transaction is subject to curtailment or cessation of delivery by the supplier in accordance with a prior agreement with the other party or under specified conditions.

Interruptible rate
The agreed-upon rate for energy sold as interruptible.

Interruptible service
Gas or electricity sales that are subject to interruption for a specified number of days or hours during times of peak demand or in the event of system emergencies. In exchange for interruptibility, buyers pay lower prices.

Introducing broker
A firm engaged in soliciting or in accepting orders for the purchase or sale of any commodity for future delivery.

Inverted block rate
A fee structure for energy in which each additional block or unit of energy above a given level is charged at a higher rate than preceding blocks. Most commonly applied to energy delivered to clients who require large portions of their energy during peak demand periods when energy costs are typically higher, or when additional system capacity has to be brought online to meet that client’s needs.

IPCC
International Panel on Climate Change. Panel of the OECD.

J

Japanese Crude Cocktail (JCC)
A commonly used reference price index for long-term liquefied natural gas contracts in Japan, as well as Taiwan and South Korea, and is published monthly by the Japanese government representing the average crude oil import price into Japan.

Jet fuel
A refined petroleum product used in jet aircraft engines. It includes kerosene-type jet fuel and naphtha-type jet fuel.

Joint implementation
A mechanism defined in Article 6 of the Kyoto Protocol, allows a country with an emission reduction or limitation commitment under the Kyoto Protocol (Annex B Party) to earn emission reduction units (ERUs) from an emission reduction or emission removal project in another Annex B Party, each equivalent to one tonne of CO2, which can be counted towards meeting its Kyoto target. Joint implementation is intended to offer parties a  flexible and cost-efficient means of fulfilling a part of their Kyoto commitments, while the host party benefits from foreign investment and technology transfer.

Joule
The meter-kilogram-second unit of work or energy, equal to the work done by a force of one Newton when its point of application moves through a distance of one meter in the direction of the force; equivalent to 107 ergs and one watt-second.

K

Kerosene
A light petroleum distillate that is used in space heaters, cook stoves, and water heaters and is suitable for use as a light source when burned in wick-fed lamps. Kerosene has a maximum distillation temperature of 400 degrees Fahrenheit at the 10-percent recovery point, a final boiling point of 572 degrees Fahrenheit, and a minimum flash point of 100 degrees Fahrenheit. Included are No. 1-K and No. 2-K, the two grades recognized by ASTM Specification D 3699 as well as all other grades of kerosene called range or stove oil, which have properties similar to those of No. 1 fuel oil. Also see Kerosene-type jet fuel.

Kerosene-type jet fuel
A kerosene-based product having a maximum distillation temperature of 400 degrees Fahrenheit at the 10-percent recovery point and a final maximum boiling point of 572 degrees Fahrenheit and meeting ASTM Specification D 1655and Military Specifications MIL-T-5624P and MIL-T-83133D (Grades JP-5and JP-8). It is used for commercial and military turbo jet and turbo prop aircraft engines.

  • Commercial: Kerosene-type jet fuel intended for use in commercial aircraft.
  • Military: Kerosene-type jet fuel intended for use in military aircraft.

Kilovolt-Ampere (kVa)
A unit of apparent power, equal to 1,000 volt-amperes; the mathematical product of the volts and amperes in an electrical circuit.

Kinetic energy
Energy available as a result of motion that varies directly in proportion to an object’s mass and the square of its velocity.

Kyoto Protocol
An agreement made in Kyoto, Japan, in December 1997 under which industrialized countries agreed to adopt specific goals and timelines for nationwide reductions of greenhouse gas emissions between 2008 and 2012. The two major mechanisms for achieving this established under the protocol are emissions trading and the Clean Development Mechanism. The EU and its Member States ratified the Kyoto Protocol in May 2002. The EU has a target goal of 8% reduction in greenhouse gases and Japan’s goal is a 6% reduction. The Protocol came into effect for all signatory countries on February 16, 2005. As of December 2008, the US had not ratified the Kyoto Protocol.

L

Landfill gas
Gas that is generated by decomposition of organic material at landfill disposal sites. The average composition of landfill gas is approximately 50 percent methane and 50 percent carbon dioxide and water vapor by volume. The methane percentage, however, can vary from 40 to 60 percent, depending on several factors including waste composition (e.g. carbohydrate and cellulose content). The methane in landfill gas may be vented, flared, combusted to generate electricity or useful thermal energy on-site, or injected into a pipeline for combustion off-site.

Lay time
The amount of time specified as allowable in a shipping charter contract for loading and unloading of cargo. Demurrage is incurred if the lay time is exceeded.

Leaded gasoline
A fuel that contains more than0.05 gram of lead per gallon or more than 0.005 gram of phosphorus per gallon.

Leaded premium gasoline
Gasoline having an antiknock index (R+M/2) greater than 90 and containing more than 0.05 grams of lead or 0.005 grams of phosphorus per gallon.

Leaded regular gasoline
Gasoline having an antiknock index (R+M/2) greater than or equal to 87 and less than or equal to 90 and containing more than 0.05 grams of lead or 0.005 grams of phosphorus per gallon.

Liability
An amount payable in dollars or by future services to be rendered.

Liberalization
There is talk of liberalization when a government lifts restrictions on access to a particular market and therefore allows competition. Liberalization of the energy markets involves making access possible for all parties who want to enter the market without discriminating against certain parties. The objective of liberalization is free pricing.

Light oil
Liquid oil with an API gravity of more than 28 degrees.

Lignite
The lowest rank of coal, often referred to as brown coal, used almost exclusively as fuel for steam-electric power generation. It is brownish-black and has a high inherent moisture content, sometimes as high as 45 percent The heat content of lignite ranges from 9 to 17 million Btu per ton on a moist, mineral-matter-free basis. The heat content of lignite consumed in the United States averages 13 million Btu per ton, on the as-received basis (i.e. containing both inherent moisture and mineral matter).

Line losses
The difference between the quantity of electricity generated and the quantity delivered at some point in the electricity system. Losses vary depending on temperature, voltage level and load levels.

Line packing/filling
Raising the pressure within a gas pipeline system in order to increase the system’s storage capability – important for system operation.

Liquefied natural gas (LNG)
LNG is compressed natural gas (mainly methane and ethane), which (unlike liquefied petroleum gas) is reduced to a liquid form by cooling it to -258° Fahrenheit. The volume of LNG is 1/600th of its volume as gas vapor. It is odorless, colorless, non-toxic and non-corrosive. LNG is much easier and more cost-effective to store and to transport, especially where pipelines do not exist.

Liquefied petroleum gases
A group of hydrocarbon-based gases derived from crude oil refining or natural gas fractionation. They include ethane, ethylene, propane, propylene, normal butane, butylene, isobutane, and isobutylene. For convenience of transportation, these gases are liquefied through pressurization.

Liquefied refinery gases (LRG)
Liquefied petroleum gases fractionated from refinery or still gases. Through compression and/or refrigeration, they are retained in the liquid state. The reported categories are ethane/ethylene, propane/propylene, normal butane/butylene, and isobutane/isobutylene. Excludes still gas.

Liquefaction
Converting natural gas into liquid form, resulting in the Liquefied Natural Gas that is transported in ships.

Liquefaction plant
A facility that converts natural gas from its natural gaseous state to a liquid state. The gas is first cleaned of all traces of CO2, water, mercury and sulphur. It is then cooled to -160°C in cold boxes until it becomes liquid. In this form, it is stored in tanks.

Load
The amount of power carried by a utility system or sub-system, or the amount of power consumed by an electrical device, at a specified time. Load is also referred to as demand.

Load curve
The relationship of power supplied to the time of occurrence. Illustrates the varying magnitude of the load during the period covered.

Load factor
The ratio between average and peak usage for electricity or gas customers. The higher the load factor, the smaller the difference between average and peak demand.

Load management
The process of structuring and/or scheduling the use of energy among a group of customers to best match available supplies to available demand.

Load management technique
Utility demand management practices directed at reducing the maximum kilowatt demand on an electric system and/or modifying the coincident peak demand of one or more classes of service to better meet the utility system capability for a given hour, day, week, season, or year.

Load profile
The energy usage pattern of a customer who does not use meters capable of measuring short-term usage is referred to as the customer’s load profile.

Load shape
The distribution of energy requirements over time. Derived from the practice of plotting energy requirements on a chart or graph, which produces a graph whose curve usually has a distinctive shape. When distribution of energy requirements is changed, the shape of the graph also changes, so the redistribution of demand or load is referred to as changing the load shape.

Load shedding
Blocking of customer access to energy, usually due to temporary shortage of supply.

Load shifting
The practice of altering the pattern of energy use so that on-peak energy use is shifted to off-peak periods. Load shifting is a fundamental demand-side management objective.

Local Distribution Company
A company that operates or controls the retail distribution system for the delivery of natural gas or electricity.

Local distribution zones
The zones into which National Grid Transco has divided the UK for the purpose of calculating shippers’ charges for transporting gas within the national transmission system.

Log normal distribution
A probability distribution such that the natural logarithm of the variable is normally distributed.

Long the basis
A person or firm that has bought the spot commodity and hedged with a sale of futures is said to be long the basis.

Loop flows
Unintended flows on electricity transmission systems that occur as a by-product of the dispatch of electricity down an intended path.

Loss
The loss of real energy or loss of capacity to transmit energy in an electrical system. The most common form of energy loss in electrical generation and transmission systems is loss through heat.

Low Btu gas
A fuel gas with a heating value between 90 and 200 Btu per cubic foot.

Low sulfur diesel (LSD) fuel
Diesel fuel containing more than 15 but less than 500 parts per million (ppm) sulfur.

Lubricants
Substances used to reduce friction between bearing surfaces, or incorporated into other materials used as processing aids in the manufacture of other products, or used as carriers of other materials. Petroleum lubricants may be produced either from distillates or residues. Lubricants include all grades of lubricating oils, from spindle oil to cylinder oil to those used increases.

M

Market power
A given party’s ability to manipulate some or all aspects of a market’s behavior. Market power can consist of ability to control price, demand, supply and/or delivery, and can be exerted through ownership of a critical level of any portion of the supply chain or through the ability to purchase or consume a critical level of supply.

McCloskey (Coal)
A premier source of news, analysis and data on the international coal industry.

Make-up gas
In a gas buyer’s contract there are often terms that allow the buyer to take make-up gas in contract periods after it has been paid for but not taken. There may be a limit to the amount of make-up the buyer can recover in any given period.

Marginal cost
The change in cost resulting from production of a single additional unit of production.

Marker crudes
Crudes against which other crudes are priced. Widely used marker crudes include West Texas Intermediate (for US destinations), Brent blend (for European destinations) and Dubai (for Far Eastern destinations).

Methane
A colorless, flammable, odorless hydrocarbon gas (CH4) which is the major component of natural gas. It is also an important source of hydrogen in various industrial processes. Methane is a greenhouse gas.

Metric ton (tonne)
A metric ton is 2,204.62 pounds.

Middle distillates
A general classification of refined petroleum products that includes distillate fuel oil and kerosene.

Minimum generation
The lowest level of production that a generating unit can maintain before it ceases to be cost-effective to keep online.

MmBtu
Millions of British thermal units.

MNP
The Milieu- en Natuurplanbureau – Netherlands Environmental Assessment Agency – is an agency that was part of the Ministry of Health and Environment until 1 May 2005. The body now operates independently and is part of the Ministry of Housing, Regional Development and the Environment. The Director of the MNP is also an advisory member of the Scientific Council for Government Policy. The MNP’s mission is to advice the government on political and social considerations regarding economic, ecological, environmental and cultural matters.

Moist (coal) basis
Moist coal contains its natural inherent or bed moisture, but does not include water adhering to the surface. Coal analyses expressed on a moist basis are performed or adjusted so as to describe the data when the coal contains only that moisture that exists in the bed in its natural state of deposition and when the coal has not lost any moisture due to drying.

Moisture content
The water content of a substance (a solid fuel) as measured under specified conditions being the “dry basis,” which equals the weight of the wet sample minus the weight of a (bone) dry sample divided by the weight of the dry sample times 100 (to get percent); “wet basis,” which is equal to the weight of the wet sample minus the weight of the dry sample divided by the weight of the wet sample times 100.

Monopoly
When only one supplier, provider or seller is available for a given commodity in a given market, that individual or entity is referred to as a monopoly, and has monopoly control over that market.

Monopsony
When only one buyer is available for a given commodity.

Motor gasoline (finished)
 A complex mixture of relatively volatile hydrocarbons with or without small quantities of additives, blended to form a fuel suitable for use in spark-ignition engines. Motor gasoline, as defined in ASTM Specification D 4814 or Federal Specification VV-G-1690C, is characterized as having a boiling range of 122 to 158 degrees Fahrenheit at the 10 percent recovery point to 365 to 374 degrees Fahrenheit at the 90 percent recovery point. Motor Gasoline includes conventional gasoline; all types of oxygenated gasoline, including gasohol; and reformulated gasoline, but excludes aviation gasoline. Note: Volumetric data on blending components, such as oxygenates, are not counted in data on finished motor gasoline until the blending components are blended into the gasoline.

Motor gasoline blending
Mechanical mixing of motor gasoline blending components, and oxygenates when required, to produce finished motor gasoline. Finished motor gasoline may be further mixed with other motor gasoline blending components or oxygenates, resulting in increased volumes of finished motor gasoline and/or changes in the formulation of finished motor gasoline (e.g., conventional motor gasoline mixed with MTBE to produce oxygenated motor gasoline).

Motor gasoline blending components
Naphtha’s (e.g., straight-run gasoline, alkylate, reformate, benzene, toluene, xylene) used for blending or compounding into finished motor gasoline. These components include reformulated gasoline blend stock for oxygenate blending (RBOB) but exclude oxygenates (alcohols, ethers), butane, and pentanes plus. Note Oxygenates are reported as individual components and are included in the total for other hydrocarbons, hydrogen’s, and oxygenates.

Mtpa
An acronym for metric tonnes per annum, which is a typical measurement unit in liquefied natural gas markets for production and facility capacity.

Must-take resources
Resources that must be taken by the customer regardless of market prices or conditions. These are energy resources that have to be acquired and consumed before any other resources are made available. Depending on the jurisdiction and the client, must-take resources may include co-generated energy from qualifying facilities, nuclear or hydroelectric energy, renewable energy from solar, wind or tidal generators, and energy already arranged through pre-existing contracts.

N

N2O
Nitrous Oxide

NAM
Nederlandse Aardolie Maatschappij – the Netherlands Petroleum Association is an oil and gas producing company that has a large number of the Dutch licenses. The NAM also has the license for the exploitation of the Groningen Field. NAM is a joint venture between Shell and ExxonMobil.

Naphtha
A generic term applied to a petroleum fraction with an approximate boiling range between 122 degrees Fahrenheit and 400 degrees Fahrenheit.

Naphtha-type jet fuel
A fuel in the heavy naphtha boiling range having an average gravity of 52.8 degrees API, 20 to 90 percent distillation temperatures of 290 degrees to 470 degrees Fahrenheit, and meeting Military Specification MIL-T-5624L (Grade JP-4).It is used primarily for military turbojet and turboprop aircraft engines because it has a lower freeze point than other aviation fuels and meets engine requirements at high altitudes and speeds. Note: Beginning with January 2004 data, naphtha-type jet fuel is included in Miscellaneous Products.

Naphtha’s
Refined or partly refined light distillates with an approximate boiling point range of 27 degrees to 221 degrees Centigrade. Blended further or mixed with other materials, they make high-grade motor gasoline or jet fuel. Also, used as solvents, petrochemical feedstocks, or as raw materials for the production of town gas.

National allocation plan (NAP)
A plan to establish the emissions target for the covered sectors, as well as deciding how this target is divided among the various installations covered by the system. Article 9 of the Emissions Trading Directive established that each member state periodically has to develop such a national allocation plan.

National balancing point (NBP)
The national balancing point, commonly referred to as the NBP, is a virtual trading location for the sale and purchase of UK natural gas. It is the most liquid gas trading point in Europe. Gas at the NBP trades in pence per therm.

National Grid Transco
An international energy delivery business, whose principal activities are in the regulated electricity and gas industries. It owns and operates the high-voltage electricity transmission network in England and Wales and the UK’s natural gas transportation system. In July 2005 its shareholders agreed to change its name to National Grid plc.

National transmission system (NTS)
The UK high-pressure pipeline system, owned by National Grid Transco, used to transport gas between terminals, storage facilities, large consumers and regional sites. When the gas leaves the NTS at an off take, it goes through a series of pressure-reducing tiers before it reaches the consumer.

Native gas
Gas in place at the time that a reservoir was converted to use as an underground storage reservoir in contrast to injected gas volumes.

Natural gas
Gas consisting mainly of methane and ethane that occurs naturally in the earth’s crust. It is often found in association with crude oil, when it is called associated gas. Futures and options contracts are traded for instance on Nymex, International Petroleum Exchange and Kansas City Board of Trade.

Natural gas field facility
A field facility designed to process natural gas produced from more than one lease for the purpose of recovering condensate from a stream of natural gas; however, some field facilities are designed to recover propane, normal butane, pentanes plus, etc., and to control the quality of natural gas to be marketed.

Natural gas hydrates
Solid, crystalline, wax-like substances composed of water, methane, and usually a small amount of other gases, with the gases being trapped in the interstices of a water-ice lattice. They form beneath permafrost and on the ocean floor under conditions of moderately high pressure and at temperatures near the freezing point of water.

Natural Gas Liquids (NGL)
Those hydrocarbons in natural gas that are separated from the gas as liquids through the process of absorption, condensation, adsorption, or other methods in gas processing or cycling plants. Generally such liquids consist of propane and heavier hydrocarbons and are commonly referred to as lease condensate, natural gasoline, and liquefied petroleum gases. Natural gas liquids include natural gas plant liquids (primarily ethane, propane, butane, and isobutane; see Natural Gas Plant Liquids) and lease condensate (primarily pentanes produced from natural gas at lease separators and field facilities; see Lease Condensate).

Natural hedge
The reduction in risk that can arise from an institution’s normal operating procedures. A company that has significant sales in one country holds a natural hedge to its currency risk if it also generates expenses in that currency. For example, an oil producer with refining operations in the US is (partially) naturally hedged against the cost of dollar-denominated crude oil. While a company can alter its operational behavior to take advantage of a natural hedge, such hedges are less flexible than financial hedges.

Natural monopoly
A market that may appear to be competitive but includes one competitor who can produce a better product or offer a lower price than all other competitors combined.

Natural reservoir pressure
The energy within an oil or gas reservoir that causes the oil or gas to rise (unassisted by other forces) to the earth’s surface when the reservoir is penetrated by an oil or gas well. The energy may be the result of “dissolved gas drive,” “gas cap drive,” or “water drive.” Regardless of the type of drive, the principle is the same: the energy of the gas or water, creating a natural pressure, forces the oil or gas to the well bore.

Net Connect Germany
Net Connect Germany is a joint company established 2008 by bayernets GmbH and E.ON Gastransport for the merged H-gas market area in Germany. The company’s business activities, which include balancing group management, operation of the virtual trading point and the online provision of information including billing and control energy data, are geared towards serving network operators and shippers alike.

Netback
A provision in a physical power contract that allows the bearer to net a debt position with one counterparty by offsetting it with a credit position with another counterparty.

Netback price
A pricing assessment or pricing formula based  on the effective price to the producer or seller at a specific location or defined point. For example, liquefied natural gas netback prices may be determined by the market natural gas price at market destinations less the cost of pipeline transportation, regasification, waterborne shipping and liquefaction. Crude oil may be priced on the market value of its refined products, or natural gas priced based on the natural gas market price less the cost for delivering from the defined point to the market location.

Netback purchase
Refers to a crude oil purchase agreement wherein the price paid for the crude is determined by sales prices of the types of products that are derivable from that crude as well as other considerations (e.g., transportation and processing costs). Typically, the price is calculated based on product prices extant on or near the cargo’s date of importation.

Network code
(UK) the rules governing relations between National Grid Transco, as operator of the national transmission system, and shippers who use the system.

Newcastle coal
Typically, Newcastle thermal coal prices as traded for Australia’s Newcastle port in New South Wales, which is the world’s largest coal export harbor.

New electricity trading arrangements (Neta)
Neta is a system of bilateral trading between generators, suppliers and consumers on the UK market, the aim of which is to reduce wholesale electricity prices.

New gas trading arrangements (NGTA)
The new gas trading arrangements were introduced in the UK in October 1999 in an attempt to improve the efficiency of the balancing system. The arrangements consist of the on-the-day commodity market, auctions of entry capacity and improved incentives for shippers to balance their own positions.

Nitrogen dioxide
A compound of nitrogen and oxygen formed by the oxidation of nitric oxide (NO) which is produced by the combustion of solid fuels.

Nitrogen oxides (NOx)
Compounds of nitrogen and oxygen produced by the burning of fossil fuels.

Nitrous oxide (N2O)
A colorless gas, naturally occurring in the atmosphere. Nitrous oxide has a 100-year Global Warming Potential of 310.

NMa
Nederlandse Mededingingsautoriteit – Netherlands Competition Authority is the regulator of the free market in the Dutch economy and aims at preventing cartel formation and/or market power. It has set up separate bodies for sectors with specific problems; DTe is specifically focussed on the energy market.

No. 1 diesel fuel
A light distillate fuel oil that has a distillation temperature of 550 degrees Fahrenheit at the 90-percent recovery point and meets the specifications defined in ASTM Specification D 975. It is used in high speed diesel engines generally operated under frequent speed and load changes, such as those in city buses and similar vehicles (No. 1 distillate).

No. 1 distillate
A light petroleum distillate that can be used as either a diesel fuel (No. 1 diesel fuel) or a fuel oil (No. 1 fuel oil).

No. 1 fuel oil
A light distillate fuel oil that has distillation temperatures of 400 degrees Fahrenheit at the 10-percent recovery point and 550 degrees Fahrenheit at the 90-percent recovery point and meets the specifications defined in ASTM Specification D 396. It is used primarily as fuel for portable outdoor stoves and portable outdoor heaters (No. 1 Distillate).

No. 2 diesel fuel
A distillate fuel oil that has a distillation temperature of 640 degrees Fahrenheit at the 90-percent recovery point and meets the specifications defined in ASTM Specification D 975. It is used in high-speed diesel engines that are generally operated under uniform speed and load conditions, such as those in railroad locomotives, trucks, and automobiles (No. 2 Distillate).

No. 2 distillate
A petroleum distillate that can be used as either a diesel fuel (No. 2 diesel fuel) or a fuel oil (No. 2 fuel oil).

No. 2 fuel oil (heating oil)
A distillate fuel oil that has a distillation temperature of 640 degrees Fahrenheit at the 90-percent recovery point and meets the specifications defined in ASTM Specification D 396. It is used in atomizing type burners for domestic heating or for moderate capacity commercial/industrial burner units (No. 2 Distillate).

No. 2 fuel oil and No. 2 diesel sold to consumers for all other end uses
Those consumers who purchase fuel oil or diesel fuel for their own use including commercial/institutional buildings (including apartment buildings), manufacturing and nonmanufacturing establishments, farms (including farm houses), motor vehicles, commercial or private boats, military, governments, electric utilities, railroads, construction, logging or any other nonresidential end-use purpose.

No. 2 fuel oil sold to private homes for heating
Private household customers who purchase fuel oil for the specific purpose of heating their home, water heating, cooking, etc., excluding farm houses, farming and apartment buildings.

No. 4 fuel oil
A distillate fuel oil made by blending distillate fuel oil and residual fuel oil stocks. It conforms with ASTM Specification D 396 or Federal Specification VV-F-815C and is used extensively in industrial plants and in commercial burner installations that are not equipped with preheating facilities. It also includes No. 4 diesel fuel used for low- and medium-speed diesel engines and conforms to ASTM Specification D 975.

No. 5 and no. 6 fuel oil sold directly to the ultimate consumer
Includes ships, mines, smelters, manufacturing plants, electric utilities, drilling, railroad.

No. 5 and no. 6 fuel oil sold to refiners or other dealers who will resale the product
Includes all volumes of No. 5 and No. 6 fuel oil purchased by a trade or business with the intent of reselling the product to the ultimate consumers.

Nox
Nitrogen oxides.

Nominal price
The price paid for a product or service at the time of the transaction. Nominal prices are those that have not been adjusted to remove the effect of changes in the purchasing power of the dollar; they reflect buying power in the year in which the transaction occurred.

Nominate
Determining, shortly before physical delivery, how much of the booked ‘firm’ capacity will be used. The un-nominated capacity is utilized by others as ‘interruptible’ capacity.

Nomination
The notification to put into effect a contract or part of a contract. For example, a gas flow nomination from a shipper to advise the pipeline owner of the amount of gas it wishes to transport or hold in storage on a given day.

Nomination deadlines
The deadline for nominations for gas supply, transportation and storage volumes given to the pipeline owner for a full month in the last week of the previous month. This happens for instance in the US around the time of the expiry of the futures contract on Nymex; the actual day varies between pipelines.

Nonassociated natural gas
Natural gas that is not in contact with significant quantities of crude oil in the reservoir.

Nonfirm power
Power or power-producing capacity supplied or available under a commitment having limited or no assured availability.

Non-firm purchase

  1. The purchase of any commodity on an as-available basis.
  2. Spot market purchases of available energy that is not likely to be required by other customers who may have arranged for production at that particular time. Once the purchase is made, the seller cannot arbitrarily make that energy available to another customer who is willing to pay a higher price, but the buyer may not always be able to buy energy in this fashion.

Non-firm transmission service

  1. Point-to-point transmission service that is reserved and/or scheduled on an as-available basis and is subject to interruption.
  2. Available on a stand-alone basis as either hourly non-firm transmission service or short-term non-firm transmission service.

Nonfungible product
A gasoline blend or blendstock that cannot be shipped via existing petroleum product distribution systems because of incompatibility problems. Gasoline/ethanol blends, for example, are contaminated by water that is typically present in petroleum product distribution systems.

Nonrenewable fuels
Fuels that cannot be easily made or “renewed,” such as oil, natural gas, and coal.

Nonspinning reserve
The generating capacity not currently running but capable of being connected to the bus and load within a specified time.

Nuclear electric power (nuclear power)
Electricity generated by the use of the thermal energy released from the fission of nuclear fuel in a reactor.

Nuclear fuel
Fissionable materials that have been enriched to such a composition that, when placed in a nuclear reactor, will support a self-sustaining fission chain reaction, producing heat in a controlled manner for process use.

Nuclear reactor
An apparatus in which a nuclear fission chain reaction can be initiated, controlled, and sustained at a specific rate. A reactor includes fuel (fissionable material), moderating material to control the rate of fission, a heavy-walled pressure vessel to house reactor components, shielding to protect personnel, a system to conduct heat away from the reactor, and instrumentation for monitoring and controlling the reactor’s systems.

NWEA
The Netherlands Wind Energy Association promotes the interests of wind energy. Within the NWEA, all the organizations and companies that are active in the Netherlands in the field of wind energy work together.

O

O&M
Operation and Maintenance

O3
Ozone

OCM
On -the-day commodity market

Octane
A flammable liquid hydrocarbon found in petroleum. Used as a standard to measure the anti-knock properties of motor fuel.

Octane rating
A number used to indicate gasoline’s antiknock performance in motor vehicle engines. The two recognized laboratory engine test methods for determining the antiknock rating, i.e., octane rating, of gasoline’s are the Research method and the Motor method. To provide a single number as guidance to the consumer, the antiknock index (R + M)/2, which is the average of the Research and Motor octane numbers, was developed.

Odorant
(Gas) mercaptan added to natural gas to give it smell so that gas escapes (leaks) can be detected.

OECD
The Organization for Economic Cooperation and Development is a collaboration of 30 (chiefly Western) countries that discusses, studies and coordinates social and economic policy. The countries attempt to solve problems together and attune international policy.

Off-peak
Times of relatively low energy demand, typically nights and weekends.

Off peak gas
Gas that is to be delivered and taken on demand when demand is not at its peak.

Off-specification
Oil product or gas that does not meet specification. Refers either to contract specification or those benchmark specifications generally used in the physical market.

Offshore
That geographic area that lies seaward of the coastline. In general, the coastline is the line of ordinary low water along with that portion of the coast that is in direct contact with the open sea or the line marking the seaward limit of inland water. If a state agency uses a different basis for classifying onshore and offshore areas, the state classification should be used (e.g., Cook Inlet in Alaska is classified as offshore; for Louisiana, the coastline is defined as the Chapman Line, as modified by subsequent adjudication).

Off take
(UK) gas removed from the national transmission system at reduced pressure.

Ohm
A measure of the electrical resistance of a material equal to the resistance of a circuit in which the potential difference of 1 volt produces a current of 1 ampere.

Ohm’s Law
In a given electrical circuit, the amount of current in amperes is equal to the pressure in volts divided by the resistance, in ohms. The principle is named after the German scientist Georg Simon Ohm.

Oil
A mixture of hydrocarbons usually existing in the liquid state in natural underground pools or reservoirs. Gas is often found in association with oil.

Oil equivalents
Oil substitutes or products derived from oil. Generally gas is meant, which is then expressed in the same measure as oil: in barrels of 159 liters.

Oil reservoir
An underground pool of liquid consisting of hydrocarbons, sulfur, oxygen, and nitrogen trapped within a geological formation and protected from evaporation by the overlying mineral strata.

Oil shale
A sedimentary rock containing kerogen, a solid organic material.

Oil stocks
Oil stocks include crude oil (including strategic reserves), unfinished oils, natural gas plant liquids, and refined petroleum products.

Oil tanker freight derivatives
Oil tanker freight derivatives are over-the counter trades bought and sold in terms of world scale prices and settled against 11 key tanker routes listed on the London-based Baltic Exchange. The world scale system (worldwide tanker nominal freight scale) is a system of pricing tanker freight as a percentage of expected freight rates as published by the nonprofit World Scale Association in a table listing the price in dollars per tonne of oil for standard routes, and there is a flat rate for each route. Rates listed – flat rates – are termed WS100, which is the amount needed for a standard vessel to make a profit. Similarly, WS175 means 175% of the published rate.

Oil well
A well completed for the production of crude oil from at least one oil zone or reservoir.

Oligopoly
A small group of suppliers, providers or sellers who have the ability to control market prices for a given commodity if they should ever decide to work together for that purpose.

On peak
Periods of relatively high system demand. These periods often occur in daily, weekly, and seasonal patterns; these on-peak periods differ for each individual electric utility.

On-the-day commodity market (OCM)
Part of the new gas trading arrangements introduced in the UK in October 1999, the OCM is a screen-based, within-day gas market that allows shippers to fine-tune their daily gas positions.

One day in 10 years
Reliability standard often applied to electricity generation systems. Under this standard, a combination of forced and planned outages would leave the system without enough generation to meet load on a probabilistic basis on only one day in every 10 years.

One in twenty (1 in 20)
Peak-day demand – the highest gas demand expected on any given day over a 20-year period. The UK gas network is designed to cope with this calculated level of demand.

One in fifty (1 in 50)
The highest gas demand expected in a single year out of 50 years. The UK gas pipeline system is designed to cope with this calculated level of demand.

On-peak
Refers to hours of the business day when demand is at its peak. In the US, physical market, on-peak definitions vary by North American Electric Reliability Councils.

Open-access transmission
The provision of electricity transmission to third parties on a non-discriminatory basis.

Open-access transportation
The transportation of gas or electricity for third parties on a non-discriminatory basis.

Operating income
Operating revenues less operating expenses. Excludes items of other revenue and expense, such as equity in earnings of unconsolidated affiliates, dividends, interest income and expense, income taxes, extraordinary items, and cumulative effects of accounting changes.

Operating revenues
Segment revenues both from sales to unaffiliated customers (i.e., revenue from customers outside the enterprise as reported in the company’s consolidated income statement) and from intersegment sales or transfers, if any, of product and services similar to those sold to unaffiliated customers, excluding equity in earnings of unconsolidated affiliates; dividend and interest income; gain on disposition of property, plant, and equipment; and foreign currency translation effects.

Operating unit
A unit that is in operation at the beginning of the reporting period.

Operator, oil and/or gas well
The person responsible for the management and day-to-day operation of one or more crude oil and/or natural gas wells as of December 31 of the report year. The operator is generally a working-interest owner or a company under contract to the working-interest owner(s). Wells included are those that have proved reserves of crude oil, natural gas, and/or lease condensate in the reservoirs associated with them, whether or not they are producing. Wells abandoned during the report year are also to be considered “operated” as of December 31

Operator, gas plant
The person responsible for the management and day-to-day operation of one or more natural gas processing plants as of December 31 of the report year. The operator is generally a working-interest owner or a company under contract to the working-interest owner(s). Plants shut down during the report year are also to be considered “operated” as of December 31

Operator, oil and/or gas well
The person responsible for the management and day-to-day operation of one or more crude oil and/or natural gas wells as of December 31 of the report year. The operator is generally a working-interest owner or a company under contract to the working-interest owner(s). Wells included are those that have proved reserves of crude oil, natural gas, and/or lease condensate in the reservoirs associated with them, whether or not they are producing. Wells abandoned during the report year are also to be considered “operated” as of December 31

Opt out
The right of individual retail customers to choose not to acquire energy from an aggregator, co-op or utility that is able to serve them. Customers can only opt out if another party is ready and able to provide them with energy.

Organization for Economic Cooperation and Development (OECD)
An international organization helping governments tackle the economic, social and governance challenges of a globalized economy. Its membership comprises about 30 member countries. With active relationships with some 70 other countries, non-governmental organizations (NGOs) and civil society, it has a global reach.

Organization of the Petroleum Exporting Countries (OPEC)
OPEC members are Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, Venezuela, and UAE. OPEC member states have two regular meetings a year, but may call further meetings if crude oil prices are low. At these meetings they may review both individual and group production quotas. Although not the dominant force it was in the late 1970s, because of the increase in production by non-OPEC countries, OPEC continues to control marginal supply in a world oversupplied with crude oil.

Outage
Any interruption of current flow in a transmission or distribution system. Can occur in transmission systems without affecting end-use customers. Energy grids are designed to allow energy to be routed around areas affected by outages to ensure uninterrupted service to end-use customers.

Output
The amount of power or energy produced by agenerating unit, station, or system.

Own-use exemption
Commodity forward contracts fulfilling all criteria of derivatives for which the own-use exemption applies are not in the scope of IAS 39.

Own-use gas
The gas taken from a pipeline to drive compressors or to preheat gas.

Ozone
A molecule made up of three atoms of oxygen. Occurs naturally in the stratosphere and provides a protective layer shielding the Earth from harmful ultraviolet radiation. In the troposphere, it is a chemical oxidant, a greenhouse gas, and a major component of photochemical smog.

P

Paraffin (oil)
A light-colored, wax-free oil obtained by pressing paraffin distillate.

Paraffin (wax)
The wax removed from paraffin distillates by chilling and pressing. When separating from solutions, it is a colorless, more or less translucent, crystalline mass, without odor and taste, slightly greasy to touch, and consisting of a mixture of solid hydrocarbons in which the paraffin series predominates.

Peak demand
The maximum load during a specified period of time.

Peak-load
Peak-load pricing is a form of price differentiation, whereby a higher price is charged during peak times than during off-peak times. Peak-load pricing is intended to make better use of the total available volume of capacity. Consumers who have high price-elasticity (those who are price-sensitive) move their consumption to the period in which more capacity is available and prices are lower. It is part of an efficiently functioning market.

Peak load plant
A plant usually housing old, low-efficiency steam units, gas turbines, diesels, or pumped storage hydroelectric equipment normally used during the peak-load periods.

Peak load station
A generating facility operated expressly for the purpose of providing peak energy supply. This facility is typically operated only during particular times of day or at times of the year when there is a spike in the demand for energy for heating or cooling systems. Tend to be cheaply-constructed turbine generating units that do not use steam as an intermediate carrier of energy, and are thus less fuel-efficient and more costly to operate. The fact that they are only operated at particular times also makes them more costly to maintain, and these extra costs are typically factored into the energy costs of the heaviest consumers of energy during peak demand periods.

Peak load, peak demand
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. They 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 supply
The party who supplies energy used to meet peak demand requirements or a supply of energy that will be used to augment existing energy sources during periods of peak demand.

Peak shaving
During times of peak demand, supplies from sources other than normal suppliers are used to reduce demand on the system.

Peaking capacity
Capacity of generating equipment normally reserved for operation during the hours of highest daily, weekly, or seasonal loads.

Peaking generation
Electric generating equipment normally operated to serve loads only during annual peak loads or during system emergencies.

Peat
Peat consists of partially decomposed plant debris. It is considered an early stage in the development of coal. Peat is distinguished from lignite by the presence of free cellulose and a high moisture content (exceeding 70 percent). The heat content of air-dried peat (about 50 percent moisture) is about 9 million Btu per ton. Most U.S. peat is used as a soil conditioner. The first U.S. electric power plant fueled by peat began operation in Maine in 1990.

PEG (France)
An acronym for points d’échange de gaz, which  are trading hubs for the wholesale natural gas markets and are virtual points in each balancing zone.

Petrochemical feedstocks
Chemical feedstocks derived from petroleum principally for the manufacture of chemicals, synthetic rubber, and a variety of plastics.

Petrochemicals
Organic and in organic compounds and mixtures that include but are not limited to organic chemicals, cyclic intermediates, plastics and resins, synthetic fibers, elastomers, organic dyes, organic pigments, detergents, surface active agents, carbon black, and ammonia.

Petroleum
A broadly defined class of liquid hydrocarbon mixtures. Included are crude oil, lease condensate, unfinished oils, refined products obtained from the processing of crude oil, and natural gas plant liquids. Note: Volumes of finished petroleum products include non hydrocarbon compounds, such as additives and detergents, after they have been blended into the products.

Petroleum products
Petroleum products are obtained from the processing of crude oil (including lease condensate), natural gas, and other hydrocarbon compounds. Petroleum products include unfinished oils, liquefied petroleum gases, pentanes plus, aviation gasoline, motor gasoline, naphtha-type jet fuel, kerosene-type jet fuel, kerosene, distillate fuel oil, residual fuel oil, petrochemical feedstocks, special naphtha’s, lubricants, waxes, petroleum coke, asphalt, road oil, still gas, and miscellaneous products.

Petroleum refinery
An installation that manufactures finished petroleum products from crude oil, unfinished oils, natural gas liquids, other hydrocarbons, and alcohol.

Phelix
The Phelix or Physical Electricity Index is the reference price for power in Germany and large parts of central Europe. It is calculated daily as the average price for base load (Phelix Day Base) and peak load (Phelix Day Peak) electricity traded on the European Energy Exchange Spot Market.

Phelix base
Hourly weighted average index price per day for the hours 1–24

Phelix peak
Hourly weighted average index price for the hours 9–20 (8:00am–8:00pm)

Photosynthesis
The manufacture by plants of carbohydrates and oxygen from carbon dioxide and water in the presence of chlorophyll, with sunlight as the energy source. Carbon is sequestered and oxygen and water vapor are released in the process.

Photovoltaic and solar thermal energy (as used at electric utilities)
Energy radiated by the sun as electromagnetic waves (electromagnetic radiation) that is converted at electric utilities into electricity by means of solar (photovoltaic) cells or concentrating (focusing) collectors.

Photovoltaic cell (PVC)
An electronic device consisting of layers of semiconductor materials fabricated to form a junction (adjacent layers of materials with different electronic characteristics) and electrical contacts and being capable of converting incident light directly into electricity (direct current).

Pipeline (natural gas)
A continuous pipe conduit, complete with such equipment as valves, compressor stations, communications systems, and meters for transporting natural and/or supplemental gas from one point to another, usually from a point in or beyond the producing field or processing plant to another pipeline or to points of utilization. Also refers to a company operating such facilities.

Pipeline (petroleum)
Crude oil and product pipelines used to transport crude oil and petroleum products, respectively (including interstate, intrastate, and intercompany pipelines), within the 50 states and the District of Columbia.

Pipeline fuel
Gas consumed in the operation of pipelines, primarily in compressors.

Pipeline freight
Refers to freight carried through pipelines, including natural gas, crude oil, and petroleum products (excluding water). Energy is consumed by various electrical components of the pipeline, including, valves, other, appurtenances attaches to the pipe, compressor units, metering stations, regulator stations, delivery stations, holders and fabricated assemblies.

Pipeline imbalance
Companies that transport and use storage facilities in a pipeline system are obliged by the pipeline operator to keep their input and off take volumes in balance (within tolerance limits). If there is a positive or negative pipeline imbalance, the transporting firms are heavily financially penalized by the pipeline.

Pipeline interconnect
Where large pipelines meet and gas can be switched from one pipeline to another, such as Henry Hub in the US.

Planned outage, unplanned outage, scheduled outage
Planned Outage: Interruptions prearranged on relatively short notice. Unplanned Outage: Any interruption in the generation, transmission, or distribution of energy that is not scheduled. Scheduled Outage: Routine interruptions planned well in advance, such as those scheduled for routine maintenance or inspection of equipment.

Plant
A term commonly used either as a synonym for an industrial establishment or a generating facility or to refer to a particular process within an establishment.

Plant condensate
One of the natural gas liquids, mostly pentanes and heavier hydrocarbons, recovered and separated as liquids at gas inlet separators or scrubbers in processing plants.

Platt’s
Energy price information provider, specializing in news, prices, data, analysis, analytical tools, research and consultancy services.

Plutonium (Pu)
A heavy, fissionable, radioactive, metallic element (atomic number 94) that occurs naturally in trace amounts. It can also result as a byproduct of the fission reaction in a uranium-fuel nuclear reactor and can be recovered for future use.

Pneumatic device
A device moved or worked by air pressure.

Point(s) of delivery
Point(s) of interconnection on the Transmission Provider’s Transmission System where capacity and/or energy transmitted by the Transmission Provider will be made available to the Receiving Party. The Point(s) of Delivery shall be specified in the Service Agreement.

Portfolio optimization
Use of a linear or quadratic model to structure a portfolio to maximize or minimize yield and long-term rate sensitivity, or to increase or reduce exposure to certain industries, market sectors or macro-economic factors, subject to pre-specified constraints.

Portfolio management
Management of an energy portfolio consisting of available energy supplies and any efficiency or demand-reduction services that affect actual market demand. But also any activity related to arranging, scheduling and administration of these resources and services, and most commonly refers to resource management specifically aimed at reducing risks such as shortage of energy supplies, extremes in prices, labor difficulties or unforeseen problems with transmission.

Power
The rate of producing, transferring, or using energy, most commonly associated with electricity. Power is measured in watts and often expressed in kilowatts (kW) or megawatts (mW). Also known as “real” or “active” power.

Power (electrical)
An electric measurement unit of power called a volt-ampere is equal to the product of 1 volt and 1 ampere. This is equivalent to 1 watt for a direct current system, and a unit of apparent power is separated into real and reactive power. Real power is the work-producing part of apparent power that measures the rate of supply of energy and is denoted as kilowatts (kW). Reactive power is the portion of apparent power that does no work and is referred to as kilovars; this type of power must be supplied to most types of magnetic equipment, such as motors, and is supplied by generator or by electrostatic equipment. Volt-amperes are usually divided by 1,000 and called kilovolt amperes (kVA). Energy is denoted by the product of real power and the length of time utilized; this product is expressed as kilowatt-hours.

Power exchange
An entity providing a competitive spot market for electric power through day- and/or hour-ahead auction of generation and demand bids.

Power loss
The difference between electricity input and output as a result of an energy transfer between two points.

Powerhouse
A structure at a hydroelectric plant site that contains the turbine and generator.

Power plant
Most commonly, a generating station or energy production facility, but it can also be a site, structure or location where electricity is produced.

Power pool
A system of trading wholesale electricity that determines which generating sets or plants are called to meet demand for power at any particular time and sets the price of power for that period. Pools are deemed necessary by their proponents because electricity generally cannot be stored easily and demand has to be met through simultaneous production.

Power Purchase Agreement (PPA)
PPA refers to a contract entered into by an independent power producer and an electric utility. The power purchase agreement specifies the terms and conditions under which electric power will be generated and purchased. Power purchase agreements require the independent power producer to supply power at a specified price for the life of the agreement. While power purchase agreements vary, their common elements include: specification of the size and operating parameters of the generation facility; milestones in-service dates, and contract terms; price mechanisms; service and performance obligations; dispatchability options; and conditions of termination or default.

Precipitation swaps
Instruments linked to the degree of rainfall or snowfall. The party taking out a precipitation swap would receive payment for precipitation above a certain level.

Premium gasoline
Gasoline having an antiknock index (R+M/2) greater than 90. Includes both leaded premium gasoline as well as unleaded premium gasoline.

Pre-schedule
To schedule for delivery of physical power on a day-ahead basis.

Price
The amount of money or consideration-in-kind for which a service is bought, sold, or offered for sale.

Price cap
A cap, or limit, on the price that may be charged for a commodity which is used to prevent gouging during times of short supply or to limit price increases to a certain level.

Price index
A base point for pricing commodities.

Pricing options
Competitive energy providers in deregulated markets have a wide range of pricing options available to them. Some charge a fixed price for every kilowatt-hour of electricity consumed. Some charge based on the amount of energy used. Some charge based on usage at a given time of day, with higher kilowatt-hour charges during peak demand periods. In addition, prices may vary depending on the package of services ordered or the level of efficiency with which energy is used.

Privatization
The selling-off of government-owned enterprises.

Probable (indicated) reserves, coal
Reserves or resources for which tonnage and grade are computed partly from specific measurements, samples, or production data and partly from projection for a reasonable distance on the basis of geological evidence. The sites available are too widely or otherwise in appropriately spaced to permit the mineral bodies to be outlined completely or the grade established throughout.

Probable energy reserves
Estimated quantities of energy sources that, on the basis of geologic evidence that supports projections from proved reserves, can reasonably be expected to exist and be recoverable under existing economic and operating conditions. Site information is insufficient to establish with confidence the location, quality, and grades of the energy source. Note: This term is equivalent to “Indicated Reserves” as defined in the resource/reserve classification contained in the U.S. Geological Survey Circular 831, 1980. Measured and indicated reserves, when combined, constitute demonstrated reserves.

Production costs
Costs incurred to operate and maintain wells and related equipment and facilities, including depreciation and applicable operating costs of support equipment and facilities and other costs of operating and maintaining those wells and related equipment and facilities. They become part of the cost of oil and gas produced. The following are examples of production costs (sometimes called lifting costs): costs of labor to operate the wells and related equipment and facilities; repair and maintenance costs; the costs of materials, supplies, and fuels consumed and services utilized in operating the wells and related equipment and facilities; the costs of property taxes and insurance applicable to proved properties and wells and related equipment and facilities; the costs of severance taxes. Depreciation, depletion, and amortization (DDA) of capitalized acquisition, exploration, and development costs are not production costs, but also become part of the cost of oil and gas produced along with production (lifting) costs identified above. Production costs include the following subcategories of costs: well workers and maintenance; operating fluid injections and improved recovery programs; operating gas processing plants; ad valorem taxes; production or severance taxes; other, including overhead.

Program responsibility
Program responsibility is the responsibility of consumers (except protected consumers) and license holders to draw up introduction, transport and use of electricity programs for the service operators, and to abide by these programs. The entity responsible for the program comes between the service operator and the supplier. This entity is responsible for purchasing electricity. Exit and entry must be equal: a difference is referred to as an imbalance, a situation that TenneT discourages by imposing a fine.

Prompt barrel
Physical crude for immediate delivery.

Propane (C3H8)
A normally gaseous straight-chain hydrocarbon. It is a colorless paraffinic gas that boils at a temperature of -43.67 degrees Fahrenheit. It is extracted from natural gas or refinery gas streams. It includes all products designated in ASTM Specification D1835 and Gas Processors Association Specifications for commercial propane and HD-5 propane.

Purchased capacity
The amount of electricity and capacity available for purchase from outside a utility system.

Pulp wood
Round wood, whole-tree chips, or wood residues.

PV
Photovoltaic

Q

Quality or grade
An informal classification of coal relating to its suitability for use for a particular purpose.

Quality conversion
The conversion of the calorific value of gas from high-calorie (H-gas) to low-calorie (L-gas): This is done by mixing H-gas with nitrogen or other gasses.

R

Rate of return
The ratio of net operating income earned by a utility is calculated as a percentage of its rate base.

Ramping
A steady change in a generator’s output level over time. Ramping up is the gradual increasing of a generator’s output; ramping down is a gradual decrease.

RBOB
Reformulated Gasoline Blendstock for Oxygenate Blending

Real option
A non-traded asset or liability whose profit and- loss sensitivity to a commodity price or other market variable mimics that of an option contract. Extracting oil from an oilfield is a classic example of a real option. If oil prices remain low, the field can be left dormant at no additional cost. If oil prices rise sufficiently, the profits earned on the sale of the oil will more than outweigh the costs of extraction.

Real Power
The component of electric power that performs work, typically measured in kilowatts (kW) or megawatts(MW)–sometimes referred to as Active Power. The terms “real” or “active” are often used to modify the base term “power” to differentiate it from Reactive Power and Apparent Power.

Reference price
In an energy derivatives contract, the market price reference based on a particular location or specified grade or blend of the commodity, which is used for settlement of the contract.

Reference temperature
A typical index variable in weather derivative transactions.

Refined petroleum products
Refined petroleum products include but are not limited to gasolines, kerosene, distillates (including No. 2 fuel oil), liquefied petroleum gas, asphalt, lubricating oils, diesel fuels, and residual fuels.

Refiner
A firm or the part of a firm that refines products or blends and substantially changes products, or refines liquid hydrocarbons from oil and gas field gases, or recovers liquefied petroleum gases incident to petroleum refining and sells those products to resellers, retailers, reseller/retailers or ultimate consumers. “Refiner” includes any owner of products that contracts to have those products refined and then sells the refined products to resellers, retailers, or ultimate consumers.

Refinery
An installation that manufactures finished petroleum products from crude oil, unfinished oils, natural gas liquids, other hydrocarbons, and oxygenates.

Refinery and blender net inputs
Raw materials, unfinished oils, and blending components processed at refineries, or blended at refineries or petroleum storage terminals to produce finished petroleum products. Included are gross inputs of crude oil, natural gas plant liquids, other hydrocarbon raw materials, hydrogen, oxygenates (excluding fuel ethanol), and renewable fuels (including fuel ethanol). Also included are net inputs of unfinished oils, motor gasoline blending components, and aviation gasoline blending components. Net inputs are calculated as gross inputs minus gross production. Negative net inputs indicate gross inputs are less than gross production. Examples of negative net inputs include reformulated gasoline blendstock for oxygenate blending (RBOB) produced at refineries for shipment to blending terminals, and unfinished oils produced and added to inventory in advance of scheduled maintenance of a refinery crude oil distillation unit.

Refinery and blender net production
Liquefied refinery gases, and finished petroleum products produced at a refinery or petroleum storage terminal blending facility. Net production equals gross production minus gross inputs. Negative net production indicates gross production is less than gross inputs for a finished petroleum product. Examples of negative net production include reclassification of one finished product to another finished product, or reclassification of a finished product to unfinished oils or blending components.

Refinery input, total
The raw materials and intermediate materials processed at refineries to produce finished petroleum products. They include crude oil, products of natural gas processing plants, unfinished oils, other hydrocarbons and oxygenates, motor gasoline and aviation gasoline blending components and finished petroleum products.

Refinery losses and gains
Processing gain and loss that takes place during the refining process itself. Excludes losses that do not take place during the refining process, e.g., spills, fire losses, and contamination during blending, transportation, or storage.

Refinery output
The total amount of petroleum products produced at a refinery. Includes petroleum consumed by the refinery.

Refinery production
Petroleum products produced at a refinery or blending plant. Published production of these products equals refinery production minus refinery input. Negative production will occur when the amount of a product produced during the month is less than the amount that is reprocessed (input) or reclassified to become another product during the same month. Refinery production of unfinished oils and motor and aviation gasoline blending components appear on a net basis under refinery input.

Refinery utilization rate
Represents the use of the atmospheric crude oil distillation units. The rate is calculated by dividing the gross input to these units by the operable refining capacity of the units.

Refinery yield
Refinery yield (expressed as a percentage) represents the percent of finished product produced from input of crude oil and net input of unfinished oils. It is calculated by dividing the sum of crude oil and net unfinished input into the individual net production of finished products. Before calculating the yield for finished motor gasoline, the input of natural gas liquids, other hydrocarbons and oxygenates, and net input of motor gasoline blending components must be subtracted from the net production of finished aviation gasoline.

Reformulated blendstock for oxygenate blending (RBOB)
Motor gasoline blending components intended for blending with oxygenates to produce finished reformulated gasoline.

Reformulated gasoline
Finished gasoline formulated for use in motor vehicles, the composition and properties of which meet the requirements of the reformulated gasoline regulations promulgated by the U.S. Environmental Protection Agency under Section 211(k) of the Clean Air Act. It includes gasoline produced to meet or exceed emissions performance and benzene content standards of federal-program reformulated gasoline even though the gasoline may not meet all of the composition requirements (e.g. oxygen content) of federal-program reformulated gasoline. Note: This category includes Oxygenated Fuels Program Reformulated Gasoline (OPRG). Reformulated gasoline excludes Reformulated Blendstock for Oxygenate Blending (RBOB) and Gasoline Treated as Blendstock (GTAB).

Regasification
The vaporization of liquefied natural gas (LNG) after transport to its destination, in order to directly deliver natural gas to downstream markets. Regasification traditionally has been done by the LNG ships offloading their cargo as liquid into tanks at on-shore terminals, which then convert it to natural gas, however, the technology now exists for regasification on board specially designed vessels such as Energy Bridge LNG ships so that natural gas can be delivered directly into the natural gas pipelines. Similarly, dockside regasification can be done at specially equipped seaports such at the GasPort now operational in the UK.

Regulation

  1. The process of increasing or decreasing capacity in the system in response to changes in customer requirements. This type of regulation usually occurs at generating facilities, although the capacity of transmission and distribution systems can also be regulated.
  2. The actual amount of generating capacity that can be added to or removed from the system by an independent system operator’s energy management system. In this context, a system’s regulation is its capacity to be adjusted (regulated) on demand.
  3. An enforceable law or a rule of conduct that governs an industry’s business practices or operations. Federal and state regulations that apply to the US energy industry must first be put forward for public comment before they can be enacted into law by governing bodies, and these regulations usually prescribe penalties for violators. Regulations that the industry imposes on itself are not necessarily offered for public comment, and may not be subject to penalties if they are violated.

Regulatory commission
An agency under the auspice of a state/provincial or national government that oversees an industry, industry sector, or segment of an industry.

Reliability (electric system)
A measure of the ability of the system to continue operation while some lines or generators are out of service. Reliability deals with the performance of the system under stress.

Renewable energy
Any form of energy that is replaced by nature, with or without human assistance. Common forms of renewable energy include wind, solar, geothermal and tidal energy.

Renewable energy resources
Energy resources that are naturally replenishing but flow-limited. They are virtually inexhaustible in duration but limited in the amount of energy that is available per unit of time. Renewable energy resources include biomass, hydro, geothermal, solar, wind, ocean thermal, wave action, and tidal action.

Research and development (RD)
Basic and applied research in the sciences and engineering and the design and development of prototypes and processes, excluding quality control, routine product testing, market research, sales promotion, sales service, research in the social sciences or psychology, and other non-technological activities or technical services.

Reseller
A firm (other than a refiner) that is engaged in a trade or business that buys refined petroleum products and then sells them to a purchaser who is not the ultimate consumer of those refined products.

Reserve additions
The estimated original, recoverable, salable, and new proved reserves credited to new fields, new reservoirs, new gas purchase contracts, amendments to old gas purchase contracts, or purchase of gas reserves in-place that occurred during the year and had not been previously reported. Reserve additions refer to domestic in-the-ground natural gas reserve additions and do not refer to interstate pipeline purchase agreements; contracts with foreign suppliers; coal gas, SNG, or LNG purchase arrangements.

Reserve cost categories of $15, $30, $50, and$100 per pound U3O8
Classification of uranium reserves estimated by using break-even cut-off grades that are calculated based on forward-operating costs of less than $15, $30, $50, and $100 per pound U3O8.

Reserve generating capacity
Amount of generating capacity available to meet peak or abnormally high demands for power and to generate power during scheduled or unscheduled outages.

Reserve margin, reserve capacity

  1. A measure of available capacity over and above the capacity needed to meet normal peak demand levels.
  2. A producer’s capacity to generate more energy than the system normally requires. For a transmission company, it refers to the capacity of the transmission infrastructure to handle additional energy transport if demand levels rise beyond expected peak levels.
  3. Regulatory bodies usually require producers and transmission facilities to maintain a constant reserve margin of 10-20% of normal capacity as insurance against breakdowns in part of the system, or sudden increases in energy demand.

Reserve revisions
Changes to prior year-end proved reserves estimates, either positive or negative, resulting from new information other than an increase in proved acreage(extension). Revisions include increases of proved reserves associated with the installation of improved recovery techniques or equipment. They also include correction of prior year arithmetical or clerical errors and adjustments to prior year-end production volumes to the extent that these alter reserves estimates.

Reserves
Back-up power that must be made available at all times to meet fluctuations in system demand within a given range, to ensure smooth, continuous delivery of energy at proper voltage and current levels.

Reserves changes
Positive and negative revisions, extensions, new reservoir discoveries in old fields, and newfield discoveries that occurred during the report year.

Reserves, coal
Quantities of unextracted coal that comprise the demonstrated base for future production, including both proved and probable reserves.

Reservoir
A porous and permeable underground formation containing an individual and separate natural accumulation of producible hydrocarbons (crude oil and/or natural gas) which is confined by impermeable rock or water barriers and is characterized by a single natural pressure system.

Resource efficiency

  1. Refers either to the effectiveness with which a given resource is used, or to practices intended to enhance that effectiveness.
  2. The efficient use of combustible fuels, but it can also refer to efficient use of resources ranging from reservoir water to labor and investment capital.

Retail
Sales covering electrical energy supplied for residential, commercial and industrial end-use purposes. Other small classes, such as agriculture and street lighting, are also included in this category.

Retail wheeling
The use of gas or electricity transmission facilities to “wheel in” energy from various suppliers to local customers.

Rolling blackouts
Rolling blackouts typically occur with at least some advance warning, normally last for a fixed length of time, and are deliberately produced by utility companies. They can be used as a means of coping with peak power demands that cannot be met from existing supply. Rolling blackouts are usually intended to affect only a specific service area, and the energy provider will typically spread these blackouts among several service areas to ensure that no specific area suffers substantially more than any other. Planned outages and rolling blackouts differ slightly in that planned outages are usually announced well in advance and are most commonly needed to allow for routine maintenance, while rolling blackouts can occur with relatively little warning and are intended to take stress off of the system’s energy load.

Rollover
The closing of a position (in derivatives, for example) with a certain expiration date and the (often simultaneous) opening of an agreed position with a more distant exercise date.

Royalties
Payments, in money or kind, of a stated share of production from mineral deposits, by the lessee to the lessor. May be an established minimum, a sliding-scale, or a step-scale. A step-scale royalty rate increases by steps as the average production on the lease increases. A sliding-scale royalty rate is based on average production, and applies to all production from the lease.

Royalty
A contractual arrangement providing a mineral interest that gives the owner a right to a fractional share of production or proceeds there from, that does not contain rights and obligations of operating a mineral property, and that is normally free and clear of exploration, developmental and operating costs, except production taxes.

Royalty cost
A share of the profit or product reserved by the grantor of a mining lease, such as a royalty paid to a lessee.

Royalty interest
An interest in a mineral property provided through a royalty contract.

Royalty interest (including overriding royalty)
These interests entitle their owner(s) to a share of the mineral production from a property or to a share of the proceeds there from. They do not contain the rights and obligations of operating the property and normally do not bear any of the costs of exploration, development, and operation of the property.

S

Salt dome
A domical arch (anticline) of sedimentary rock beneath the earth’s surface in which the layers bend downward in opposite directions from the crest and that has a mass of rock salt as its core.

Sample (coal)
A representative fraction of a coal bed collected by approved methods, guarded against contamination or adulteration, and analyzed to determine the nature; chemical, mineralogic, and (or) petrographic composition; percentage or parts-per-million content of specified constituents; heat value; and possibly the reactivity of the coal or its constituents.

Schedule
A statement of the pricing format of electricity and the terms and conditions governing its applications.

Scheduled outage
The shutdown of a generating unit, transmission line, or other facility, for inspection or maintenance, in accordance with an advance schedule.

Scheduling coordinator (SC), scheduler, dispatcher
A person or body responsible for managing the scheduling of electrical transmission systems. SCs tend to be trained engineers or planners, as opposed to appointed bodies or executives.

Seasonal pricing
A special electric rate feature under which the price per unit of energy depends on the season of the year.

Seasonal supplies
Supplies of gas used for winter demand. This often includes gas from storage systems.

Seasonality
All commodity futures markets are affected to some extent by an annual seasonal cycle or ‘seasonality’. This cycle of pattern refers to the tendency of market prices to move in a given direction at certain times of the year.

Seller, supplier
An entity (individual, company or organization) able to deliver electrical energy to a customer. Sellers do not necessarily produce energy, and don’t necessarily sell to end-use customers.

Seller’s nomination contract
(Gas) the seller nominates the amount of gas it expects to deliver in a range around the estimated daily contract quantity. The buyer is obliged to take or pay for the nominated quantity on a daily basis.

Senternovem
A Dutch Ministry of Economic Affairs’ agency focused on innovative issues.

Shale gas
Natural gas produced from organic (black) shale formations.

Shipper
A company that transports gas along a pipeline system. Shippers need to be registered with the local regulatory body. In UK gas market terms, a shipper is a company that buys gas ‘at the beach’ and pays Transco to transport the gas along the pipeline system.

Shipper
A company that transports gas in the national gas transport system based on contracts with the TSO.

Short circuit
An electric current taking a shorter or different path than intended.

Short circuit current
The current flowing freely through an external circuit that has no load or resistance; the maximum current possible.

Short ton
Equal to 0.9072 tonnes. A measure of weight used in the coal industry.

Shrinkage

  1. Gas losses in the transportation and distribution systems.
  2. Gas volume lost through the extractions of liquid gases and the removal of water and other impurities.

Shrinkage allowance
The percentage of gas expected to be lost during the transportation and distribution of gas.

Sleeving

A transaction whereby two counterparties, which do not have credit with each other, ask a third party that has credit with both to be a middleman to facilitate a trade. This practice achieved some notoriety in 1998, when it emerged that the collapsed US power marketer Power Company of America had been regularly sleeving forward electricity deals.

SO2
Sulfur Dioxide.

SO2 allowance trading
Allowance trading is the centerpiece of the US Environmental Protection Agency’s acid rain program. Allowances are the currency with which compliance with SO2 emission requirements is achieved. They authorize a unit within a utility or industrial source to emit one US ton of SO2 during a given year or any year thereafter. Utilities that can use high-sulphur coal – which commands a lower price per British thermal unit than low-sulphur coals – can buy an SO2 allowance and bundle it with a highsulphur coal purchase to produce more energy.

Solar energy
The radiant energy of the sun, which can be converted into other forms of energy, such as heat or electricity.

Solar thermal panels
A system that actively concentrates thermal energy from the sun by means of solar collector panels. The panels typically consist of fat, sun-oriented boxes with transparent covers, containing water tubes of air baffles under a blackened heat absorbent panel. The energy is usually used for space heating, for water heating, and for heating swimming pools.

Spare capacity
Spare capacity is available capacity that is not being used.

Spark spread
The difference between the price of electricity sold by a generator and the price of the fuel used to generate it, adjusted for equivalent units. The spark spread can be expressed in dollars per megawatt hour ($/MWh) or dollars per million British thermal units ($/mmBtu) or other applicable units. To express it in $/MWh, the spread is calculated by multiplying the price of gas, for example (in $/mmBtu), by the heat rate (in Btu/kilowatt hour), dividing by 1,000 and then subtracting the electricity price (in $/MWh). Also called a spark arbitrage.

Special naphtha’s
All finished products within then naphtha boiling range that are used as paint thinners, cleaners, or solvents. These products are refined to a specified flash point. Special naphtha’s include all commercial hexane and cleaning solvents conforming to ASTM Specification D1836 and D484, respectively. Naphtha’s to be blended or marketed as motor gasoline or aviation gasoline, or that are to be used as petrochemical and synthetic natural gas (SNG) feedstocks are excluded.

Spinning Reserve
Any back-up energy production capacity which is can be made available to a transmission system with 10 minutes’ notice and can operate continuously for at least two hours once it is brought online. Non-spinning Reserve is generating capacity that is capable of being brought online within 10 minutes if it is offline, or interrupted within 10 minutes if it is online, and which is capable of either being operated or interrupted for at least two hours.

Spot cargo
A cargo that is available for immediate loading.

Spot market, real-time market
The spot market is a real-time commodity market for instant sale and delivery of energy. Spot markets exist for natural gas, where they’re operated on a time scale of days to weeks, and for electricity, where the time scale can be as small as a few minutes. There is no single spot marketplace for energy. Spot markets can operate wherever the infrastructure exists to conduct the transactions. Most spot markets that used to be conducted on trading floors are now operated over the Internet.

Spot price
The price for a one-time open market transaction for near-term delivery of a specific quantity of product at a specific location where the commodity is purchased at current market rates. See also spot market terms associated with specific energy types.

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.

Spread option
An option written on the differential between the prices of two commodities. Spread options may be based on the price differences between prices of the same commodity at two different locations (location spreads); prices of the same commodity at two different points in time (calendar spreads); prices of inputs to, and outputs from, a production process (processing spreads); and prices of different grades of the same commodity (quality spreads). The New York Mercantile Exchange offers the only exchange-traded options on energy spreads: the heating oil/crude oil and gasoline/crude oil crack spread options.

Sour oil
Oil with a high sulphur level.

Stack
A tall, vertical structure containing one or more flues used to discharge products of combustion to the atmosphere.

Stand-alone generator
A power source/generator that operates independently of or is not connected to an electric transmission and distribution network; used to meet a load(s) physically close to the generator.

Standard European coal agreement
The standard European coal agreement is a physical contract for coal delivered free on-board into the Amsterdam-Rotterdam-Antwerp area. It is traded in contracts (lots) of 5,000 tonnes for delivery and priced at 6,000 kilocalories per kilogram. Although it is primarily a physical contract, counterparties have the option, where mutually agreed, to close out the position should neither party want to make or take delivery of the coal.

Standby service
Support service that is available as needed to supplement a customer, a utility system, or another utility if a schedule or an agreement authorizes the transaction. The service is not regularly used.

Startup test phase of nuclear power plant
A nuclear power plant that has been licensed by the Nuclear Regulatory Commission to operate but is still in the initial testing phase, during which the production of electricity may not be continuous. In general, when the electric utility is satisfied with the plant’s performance, it formally accepts the plant from the manufacturer and places it in commercial operation status. A request is then submitted to the appropriate utility rate commission to include the power plant in the rate base calculation.

Steam
Water in vapor form; used as the working fluid in steam turbines and heating systems.

Steam (purchased)
Steam, purchased for use by a refinery, that was not generated from within the refinery complex.

Steam boiler
A type of furnace in which fuel is burned and the heat is used to produce steam.

Steam coal
All non metallurgical coal.

Steam electric power plant (conventional)
A 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.

Steam turbine
A device that converts high-pressure steam, produced in a boiler, into mechanical energy that can then be used to produce electricity by forcing blades in a cylinder to rotate and turn a generator shaft.

Stocks
Inventories of fuel stored for future use.

Storage agreement
Any contractual arrangement between the responding company and a storage operator under which gas was stored for, or gas storage service was provided to, the responding company by the storage operator, irrespective of any responding company ownership interest in either the storage facilities or stored gas.

Storage capacity
The amount of energy an energy storage device or system can store.

Storage gas
Gas kept in storage in order to balance supply and demand over time.

Storage hydroelectric plant
A hydroelectric plant with reservoir storage capacity for power use.

Storage withdrawals
Total volume of gas withdrawn from underground storage or from liquefied natural gas storage over a specified amount of time.

Strategic petroleum reserve (SPR)
Stockpiles of crude oil owned and controlled by the US government. The SPR exists to protect the US from the effects of interruptions in the supply of oil and can only be accessed by order of the US President. As of October 2008, the SPR consisted of around 701 million barrels of oil stored in underground salt caverns along the coast of the Gulf of Mexico. In May 2008, the US Congress voted to temporarily suspend shipments to the SPR.

Stratosphere
The region of the upper atmosphere extending from the tropopause (8 to 15 kilometers altitude) to about 50 kilometers. Its thermal structure, which is determined by its radiation balance, is generally very stable with low humidity.

Subbituminous coal
A coal whose properties range from those of lignite to those of bituminous coal and used primarily as fuel for steam-electric power generation. It may be dull, dark brown to black, soft and crumbly, at the lower end of the range, to bright, jetblack, hard, and relatively strong, at the upper end. Subbituminous coal contains 20 to 30 percent inherent moisture by weight. The heat content of subbituminous coal ranges from 17 to 24 million Btu per ton on a moist, mineral-matter-free basis. The heat content of subbituminous coal consumed in the United States averages 17 to 18 million Btu per ton, on the as-received basis (i.e., containing both inherent moisture and mineral matter).

Sulfur
A yellowish nonmetallic element, sometimes known as “brimstone.” It is present at various levels of concentration in many fossil fuels whose combustion releases sulfur compounds that are considered harmful to the environment. Some of the most commonly used fossil fuels are categorized according to their sulfur content, with lower sulfur fuels usually selling at a higher price. Note: No.2 Distillate fuel is currently reported as having either a 0.05 percent or lower sulfur level for on-highway vehicle use or a greater than 0.05 percent sulfur level for off-highway use, home heating oil, and commercial and industrial uses. Residual fuel, regardless of use, is classified as having either no more than 1 percent sulfur or greater than 1 percent sulfur. Coal is also classified as being low- sulfur at concentrations of 1 percent or less or high-sulfur at concentrations greater than 1 percent.

Sulphur dioxide (SO2)
This smelly substance, a gas with the distinctive odor of rotten eggs, is produced as a byproduct of burning sulphur-containing fossil fuels such as coal and natural gas. This substance changes into highly corrosive sulphuric acid when exposed to water vapor suspended in the air, and when it falls back to earth as acid rain, it can cause significant damage to virtually everything in the environment. Most airborne sulphur dioxide is produced by coal-fired generating plants.

Sulfur hexafluoride (SF6)
A colorless gas soluble in alcohol and ether, and slightly less soluble in water. It is used as a dielectric in electronics. It possesses the highest 100-year Global Warming Potential of any gas (23,900).

Sulfur oxides (SOx)
Compounds containing sulfur and oxygen, such as sulfur dioxide (SO2) and sulfur trioxide (SO3).

Summer and winter peaking
Having the annual peak demand reached both during the summer months (May through October) and during the winter months (November through April).

Summer peak
A mid-year period, usually between June 1 and September 30, when the use of cooling systems creates the strongest demand for energy in areas with hot summer weather.

Sunk cost
Part of the capital costs actually incurred up to the date of reserves estimation minus depreciation and amortization expenses. Items such as exploration costs, land acquisition costs, and costs of financing can be included.

Sunshine option
A corollary to the precipitation swap, this instrument is linked to the number of hours of sunshine. The party taking out a sunshine option would be compensated if the number of hours of sunshine fell before a certain level.

Supercyclus theory
A theory that supposes that structural under-investment will eventually lead to supply and demand ‘mismatch’.

Supplier, electric supplier
Any company, individual or organization that sells electricity to customers through its own transmission and distribution facilities, or through another company’s facilities.

Sweet oil
Oil with a low sulphur level.

Swing
Variations in gas demand.

Swing factor
In gas purchase agreements, the swing factor is a measure of the flexibility to vary nominations and is expressed as a ratio of peak to average supplies.

Swing option
The right to take more or less of a specified commodity. The opportunity to swing up is effectively a call option on the commodity specified in the contract, and the opportunity to swing down is a put option on the commodity, subject to obligations to take certain quantities over the entire life of the contract. Swing options are most commonly used in the gas market.

Swing producer
A company or country that changes its crude oil output to meet fluctuations in market demand. Saudi Arabia is seen as the world’s major swing producer, as it deliberately limits its crude oil production in an attempt to keep supply and demand roughly in balance.

Swiss Electricity Price Index (Swep)
Launched in 1998, Swep was the first ever electricity index in continental Europe. It is based in the Swiss town of Laufenburg, a major hub for power supplies between Switzerland and Germany.

Synthetic natural gas (SNG)
(Also referred to as substitute natural gas) A manufactured product, chemically similar in most respects to natural gas, resulting from the conversion or reforming of hydrocarbons that may easily be substituted for or interchanged with pipeline-quality natural gas.

System (electric)
Physically connected generation, transmission, and distribution facilities operated as an integrated unit under one central management or operating supervision.

System (gas)
An interconnected network of pipes, valves, meters, storage facilities, and auxiliary equipment used in the transportation, storage, and/or distribution of natural gas or commingled natural and supplemental gas.

System interconnection
A physical connection between two electric systems that permits the transfer of electric energy in either direction.

System operator (electric)
An individual at a control center (Balancing Authority, Transmission Operator, Generator Operator, Reliability Coordinator) whose responsibility it is to monitor and control that electric system in real time.

System reserve
The total of all capacity available within the system and obtainable on demand using existing firm contracts over and above the amount required to meet peak demand.

T

Take or pay
In a buyer’s contract, take or pay is the obligation to pay for a specified amount of gas, whether this amount is taken or not. Depending on the contract terms, under-takes or over-takes may be taken as make-up or carry-forward into the next contract period. When it is credited into another contract period, this is called make-up gas.

Tapis
A crude oil produced in Malaysia and used as a reference crude for Far East light oil.

Tar sands
Naturally occurring bitumen-impregnated sands that yield mixtures of liquid hydrocarbon and that require further processing other than mechanical blending before becoming finished petroleum products.

Tariff, tariff schedule
A tax or levy system, or a document that outlines the conditions under which taxes and levies can be charged. Tariffs are normally filed with governments or regulatory bodies and approved by these same bodies. Tariffs typically list schedules for rates, contracts, and contract and rate eligibility. When provided in printed or digital document form, tariff documents may include terms and conditions, sample forms, copies related to legislation or regulations and other related information. Tariffs are used in virtually all service industries.

Task Force Energy transition
An governmental advisory body set up by the Dutch Ministries of Economic Affairs and Housing, Regional Development and the Environment to make the Netherlands more sustainable.

TBA
Tertiary Butyl Alcohol.

Technical rally
A short rise in commodity futures prices within a general declining trend. Such a rally may result from bargain hunting by market participants or because technical analysts have noticed a particular support level at which the commodity price is expected to increase.

TenneT
As a TSO and manager of the Dutch national transport system, TenneT is responsible for the ‘motorways’ of the electricity grid that links all regional and European grids together. In addition to service operation, TenneT guards the reliability and continuity of the Dutch electricity supply.

Teu
In the container shipping world, Teu stands for ‘twenty-foot equivalent unit’. Teu is the unit of a container ship’s capacity. Most containers worldwide are twenty or forty feet in length.

Therm
The imperial unit of measurement for a quantity of gas, equivalent to 100,000 British thermal units.

Thermal
A term used to identify a type of electric generating station, capacity, capability, or output in which the source of energy for the prime mover is heat.

Thermal conversion factor
A factor for converting data between physical units of measure (such as barrels, cubic feet, or short tons) and thermal units of measure (such as British thermal units, calories, or joules); or for converting data between different thermal units of measure.

Thermal cracking
A refining process in which heat and pressure are used to break down, rearrange, or combine hydrocarbon molecules. Thermal-cracking includes gas oil, visbreaking, fluid coking, delayed coking, and other thermal cracking processes (e.g., flexicoking).

Thermal efficiency
A measure of the efficiency of converting a fuel to energy and useful work; useful work and energy output divided by higher heating value of input fuel times 100 (for percent).

Thermal resistance (R-Value)
This designates the resistance of a material to heat conduction. The greater the R-value the larger the number.

Third-party access (TPA)
Where the owner of a pipeline or electricity network is obliged to transport gas, crude or electricity in a non-discriminatory way – i.e., for any third party at the same rate as all other users. Third-party access can either be regulated by a separate agency or law, or negotiated between the incumbent and the new entrant. Also called common carriage.

Time charter
Charter party agreement for a fixed period of time instead of for a certain number of voyages. In this type of agreement usually loading and unloading costs are not included in the charter rate.

Title Transfer Facility (TTF)
A virtual trading point for natural gas in the Netherlands created in 2003 by Gasunie in order to facilitate trading in the Dutch market.

Tolling agreement
A processing agreement for the conversion of an input product for a fee. In the energy sector, tolling agreements are contracts where one party – the toller – provides a company with one form of fuel to be converted into another form of fuel on their behalf. In particular, in the liquefied natural gas (LNG) industry, tolling is a common method for financing liquefaction plants or regasification terminals. In the former case the tollers are natural gas owners who wish to convert their natural gas into LNG for transportation and storage purposes, in the latter, the tollers are LNG owners who wish their LNG to be converted into gas for distribution into the relevant end-market. In the electric power market, tolling agreements are typically between a power buyer and a power generator, under which the buyer supplies the fuel and receives an amount of power generated based on an assumed heat rate at an agreed cost.

Tolling arrangement
Contract arrangement under which a raw material or intermediate product stream from one company is delivered to the production facility of another company in exchange for the equivalent volume of finished products and payment of a processing fee.

Tonne, metric
A unit of measure that represents the measurement of mass equal to 1,000 kilograms, or 22 04.622 6 pounds.

TPA
Third Party Access relates to creating third party access to the infrastructural network by means of proceedings.

Transfer price
The monetary value assigned to products, services, or rights conveyed or exchanged between related parties, including those occurring between units of a consolidated entity.

Transformer
An electrical device for changing the voltage of alternating current.

Transmission
The transportation of bulk energy along a network or grid of power lines. It is often intended to refer specifically to high-voltage (69,000 volts or higher) electricity of the type bought and sold on the wholesale market. An additional stage of service, referred to as distribution, is required to actually deliver usable low-voltage energy to an end-use customer.

Transmission (electric)
An interconnected group of lines and associated equipment for the movement or transfer of electric energy between points of supply and points at which it is transformed for delivery to customers or is delivered to other electric systems.

Transmission and distribution loss
Electric en­ergy lost due to the transmission and distribution of electricity. Much of the loss is thermal in nature.

Transmission congestion
Occurs when there is insufficient energy to meet the demands of all customers.

Transmission line, transmission system, distribution line
A single cable carrying electricity over a transmission system. The physical path traveled by electricity on its way from producer to consumer.

Transmission Loss
Often used in place of energy loss to prevent confusion, since transmission loss means only those losses occurring in the transmission system, which is only a part of the total delivery system for electricity.

Transmission network
A system of transmission or distribution lines so cross-connected and operated as to permit multiple power supply to any principal point.

Transmission operator (electric)
The entity responsible for the reliability of its localized transmission system, and that operates or directs the operations of the transmission facilities.

Transmission system (electric)
An interconnected group of electric transmission lines and associated equipment for moving or transferring electric energy in bulk between points of supply and points where it is transformed for delivery over the distribution system lines to consumers, or is delivered to other electric systems.

Transport
Movement of natural, synthetic, and/or supplemental gas between points beyond the immediate vicinity of the field or plant from which produced except (1) for movements through well or field lines to a central point for delivery to a pipeline or processing plant within the same state or (2) movements from a city gate point of receipt to consumers through distribution mains.

Transportation capacity (UK)
The capacity of the UK natural gas system, which is assessed by the National Grid in three places: 1) The entry capacity at the entry to the national transmission system (NTS). 2) The exit capacity at the NTS off takes. 3 ) Local distribution zone (LDZ) capacity within the LDZs.

Transport Service Operator (TSO)
A Transport Service Operator, or TSO, is the organization/body whose task it is to manage/operate the energy transportation network. The TSO is generally a state-controlled company. TenneT is the TSO for electricity in the Netherlands and Gas Transport Services fulfils a similar function for gas.

Trip, trip-out
The disconnection or breaking of a circuit, usually in context of an automatic interruption of the circuit such as the opening of a circuit breaker or the changing of a switch’s position, whether performed manually or automatically.

Title Transfer Facility (TTF)
The Title Transfer Facility, more commonly known as TTF, is a virtual trading point for natural gas in the Netherlands.

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.

U

UIOLI
‘Use it or lose it’ refers to the TSO’s measure to avoid market parties buying more scarce transport capacity that they themselves need in order to keep it off the market.

UKPX
An electronic exchange that launched electricity futures in June 2000. Trading includes spot physical electricity contracts, prompt power contracts and cleared forward contracts, and is open to companies active in the UK power market. In 2003 it has been bought by APX-ENDEX, the energy exchange for gas and power.

ULCC
Ultra Large Crude Carriers: the largest vessels suitable for transporting oil.

Ultra-low sulfur diesel (ULSD) fuel
Diesel fuel containing a maximum 15 parts per million (ppm) sulfur.

Unbundling
The separating of the various components of electricity production, supply and service, in order to introduce greater elements of competition to these segments of the industry. ‘Functional unbundling’ would require monopolistic utilities to provide access to their transmission and distribution network in exchange for an access fee. ‘Structural unbundling’ would require complete vertical disaggregation, so that monopolistic utilities would be required to divest either their generation assets or their transmission/ distribution assets.

Upside/downside risk
A short forward position taken without an offsetting long physical position in the underlying commodity is said to have upside risk. This means the trader is speculating that the price of the commodity will decline. A long forward position taken without an offsetting short physical position in the underlying commodity is said to have downside risk. This means the trader is speculating that the price of the commodity will increase.

Upstream
Oil and gas exploration and production, as opposed to downstream, which refers to the areas of refining and marketing.

UN
The United Nations is an international organization set up in 1945 directly after World War 2. It is a global organization of governments working together in the field of international law, global security, maintaining human rights, developing world economy and research into social and cultural developments.

Unbundling
Separating vertically integrated monopoly functions into their component parts for the purpose of separate service offerings.

Unconventional oil and natural gas production
An umbrella term for oil and natural gas that is produced by means that do not meet the criteria for conventional production. (Conventional oil and natural gas production). Note: What has qualified as “unconventional” at any particular time is a complex interactive function of resource characteristics, the available exploration and production technologies, the current economic environment, and the scale, frequency, and duration of production from the resource. Perceptions of these factors inevitably change over time and they often differ among users of the term. For these reasons, the scope of this term will be expressly stated in any EIA publication that uses it

Underground gas storage
The use of sub-surface facilities for storing gas that has been transferred from its original location. The facilities are usually hollowed-out salt domes, geological reservoirs (depleted oil or gas fields) or water-bearing sands topped by an impermeable cap rock (aquifer).

Underground gas storage reservoir capacity
Interstate company reservoir capacities are those certificated by the Federal Energy Regulatory Commission. Independent producer and intrastate company reservoir capacities are reported as developed capacity.

Underground storage
The storage of natural gas in underground reservoirs at a different location from which it was produced.

Underground storage injections
Gas from extraneous sources put into underground storage reservoirs.

Underground storage withdrawals
Gas removed from underground storage reservoirs.

Unit price
Total revenue derived from the sale of product during the reference month divided by the total volume sold; also known as the weighted average price. Total revenue should exclude all taxes but include transportation costs that were paid as part of the purchase price.

Unit value, consumption
Total price per specified unit, including all taxes, at the point of consumption.

Uranium (U)
A heavy, naturally radioactive, metallic element (atomic number 92). Its two principally occurring isotopes are uranium-235 and uranium-238. Uranium-235 is indispensable to the nuclear industry because it is the only isotope existing in nature, to any appreciable extent, that is fissionable by thermal neutrons. Uranium-238 is also important because it absorbs neutrons to produce a radioactive isotope that subsequently decays to the isotope plutonium-239, which also is fissionable by thermal neutrons.

Utility
Any private company, publicly-owned organization or other regulated entity that provides an essential service in a given area directly to end-use customers, and that has exclusive rights to provide that service or acts as a natural monopoly in the region it serves. Gas, water and electric companies all qualify as utilities.

V

Vessel
A ship used to transport crude oil, petroleum products, or natural gas products. Vessel categories are as follows: Ultra Large Crude Carrier (ULCC), Very Large Crude Carrier (VLCC), Other Tanker, and Specialty Ship (LPG/LNG).

Vessel bunkering
Includes sales for the fueling of commercial or private boats, such as pleasure craft, fishing boats, tugboats, and ocean-going vessels, including vessels operated by oil companies. Excluded are volumes sold to the U.S. Armed Forces.

Viscosity
A measurement of a liquid’s resistance to flow. As temperature increases, viscosity decreases.

VLCC
Very large Crude Carriers: the second-largest vessels suitable for transporting oil.

VOEG
The Dutch Free Trade Organization for Gas and Electricity is a collaboration between companies active in energy trading.

Volatile matter
Those products, exclusive of moisture, given off by a material as gas or vapor. Volatile matter is determined by heating the coal to 950 degrees Centigrade under carefully controlled conditions and measuring the weight loss, excluding weight of moisture driven off at 105 degrees Centigrade.

Volatility
A measure of the variability of a market factor, most often the price of the underlying instrument.

Volt (V)
The volt is the International System of Units(SI) measure of electric potential or electromotive force. A potential of one volt appears across a resistance of one ohm when a current of one ampere flows through that resistance. Reduced to SI base units, 1 V = 1kg times m2 times s-3 times A-1(kilogram meter squared per second cubed per ampere).

Voltage
The difference in electrical potential between any two conductors or between a conductor and ground. It is a measure of the electric energy per electron that electrons can

W

War premium
A price that factors in the risk associated with war – particularly relevant for the oil market.

Waste coal
Usable material that is a byproduct of previous coal processing operations. Waste coal is usually composed of mixed coal, soil, and rock (mine waste). Most waste coal is burned as-is in unconventional fluidized-bed combustors. For some uses, waste coal may be partially cleaned by removing some extraneous noncombustible constituents. Examples of waste coal include fine coal, coal obtained from a refuse bank or slurry dam, anthracite culm, bituminous gob, and lignite waste.

Waste energy
Municipal solid waste, landfill gas, methane, digester gas, liquid acetonitrile waste, tall oil, waste alcohol, medical waste, paper pellets, sludge waste, solid byproducts, tires, agricultural byproducts, closed loop biomass, fish oil, and straw used as fuel.

Water vapor
Water in a vaporous form, especially when below boiling temperature and diffused (e.g., in the atmosphere).

Watt (W)
Unit of electrical power equivalent to one joule per second.

Watt hour (Wh)
Unit of electrical energy equivalent to the power of one watt operating for one hour.

Weather derivatives
Forward instruments used to hedge against or speculate on weather. Virtually all the instruments are based on degree days, although precipitation swaps and sunshine options are among other possible instruments.

Weather-linked bonds
The payout of weather-linked bonds, commonly known as nature-linked bonds, is linked to weather conditions. The return on the nature-linked bond is pegged to a suitable meteorological index. A trigger level is defined, which remains active during the exposure period. If this trigger is hit by the index, the issuer of the bond is allowed to default. Suitable indexes might include rainfall or temperature. Insurance companies commonly issue these bonds to hedge against high weather damage claims.

Well
A hole drilled in the earth for the purpose of:

  1. finding or producing crude oil or natural gas; or
  2. producing services related to the production of crude or natural gas.

Wellhead
The point at which the crude (and/or natural gas) exits the ground. Following historical precedent, the volume and price for crude oil production are labeled as “wellhead, “even though the cost and volume are now generally measured at the lease boundary. In the context of domestic crude price data, the term “wellhead” is the generic term used to reference the production site or lease property.

Wellhead price
The value at the mouth of the well. In general, the wellhead price is considered to be the sales price obtainable from a third party in an arm’s length transaction. Posted prices, requested prices, or prices as defined by lease agreements, contracts, or tax regulations should be used where applicable.

West Texas Intermediate (WTI)
US crude oil used as a benchmark for pricing much of the world’s crude oil production. WTI is a relatively low specific gravity ‘intermediate’ crude with low sulphur content (‘sweet’).

Wet gas

  1. Methane (dry gas) mixed with other hydrocarbons.
  2. Gas with a high liquid content, which often needs to be dried using a dehydration process.

Wet natural gas
A mixture of hydrocarbon compounds and small quantities of various non hydrocarbons existing in the gaseous phase or in solution with crude oil in porous rock formations at reservoir conditions. The principal hydrocarbons normally contained in the mixture are methane, ethane, propane, butane, and pentane. Typical nonhydrocarbon gases that may be present in reservoir natural gas are water vapor, carbon dioxide, hydrogen sulfide, nitrogen and trace amounts of helium. Under reservoir conditions, natural gas and its associated liquefiable portions occur either in a single gaseous phase in the reservoir or in solution with crude oil and are not distinguishable at the time as separate substances. Note: The Securities and Exchange Commission and the Financial Accounting Standards Board refer to this product as natural gas.

Wheeling
The delivery, and more specifically refers to delivery of energy across transmission systems. In some contexts it is used synonymously with transmission, although this use is somewhat misleading since energy can be wheeled through distribution systems as well. Wheeling across transmission systems is generally referred to as wholesale wheeling, since wholesale transactions are nearly always limited to sales made on the transmission grid. Any movement of energy between parts of the system, or within the same part of the system, that involves a change of ownership for the energy. Wholesale wheeling is the sale and delivery of energy among buyers and sellers in the wholesale market, usually to parties who take delivery of the energy on the transmission system. When a utility or energy distribution company delivers, or wheels, energy from the transmission system to an end-use customer, it is referred to as retail wheeling. When a customer who also generates energy produces energy at one site, transports it across someone else’s facilities and consumes it at another site, it is referred to as self-service wheeling.

Wheeling charge
An amount charged by one electrical system to transmit the energy of, and for, another system or systems.

Wheeling service
The movement of electricity from one system to another over transmission facilities of interconnecting systems. Wheeling service contracts can be established between two or more systems.

Wholesale
Energy supplied by one producer or marketer to another for eventual resale to consumers.

Wholesale electric power market
The purchase and sale of electricity from generators to resellers (retailers), along with the ancillary services needed to maintain reliability and power quality at the transmission level.

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 sales
Energy supplied to other electric utilities, cooperatives, municipals, and Federal and state electric agencies for resale to ultimate consumers.

Wholesale transmission services
The transmission of electric energy sold, or to be sold, in the wholesale electric power market.

Wholesale wheeling
The transmission of gas or electricity to bulk  distributors.

Wind turbine
Wind energy conversion device that produces electricity; typically three blades rotating about a horizontal axis and positioned up-wind of the supporting tower.

Winter peak
A period at the beginning of the year, usually between December 1 and March 30, when the use of heating systems creates the strongest demand for energy in areas with cold winter weather.

Wobbe Index
An index to indicate the interchangeability of fuel gases and is the best indicator of the similarity between natural gas and a specific propane-air mixture. Since this index relates heating characteristics of blended fuel gases, it can also be used to obtain constant heat flows from gases of varying compositions. The Wobbe Index, however, does not relate flame temperatures, heat transfer co-efficients or temperature gradients.

Wood conversion to Btu
Converting cords of wood into a Btu equivalent is an imprecise procedure. The number of cords each household reports having burned is in exact, even with the more precise drawings provided, because the estimate requires the respondent to add up the use of wood over a 12-month period during which wood may have been added to the supply as well as removed. Besides errors of memory inherent in this task, the estimates are subject to problems in definition and perception of what a cord is. The nominal cord as delivered to a suburban residential buyer may differ from the dimensions of the standard cord. This difference is possible because wood is most often cut in lengths that are longer than what makes a third of a cord(16 inches) and shorter than what makes a half cord (24 inches).
In other cases, wood is bought or cut in unusual units (for example, pickup-truck load, or trunk load). Finally, volume estimates are difficult to make when the wood is left in a pile instead of being stacked. Other factors that make it difficult to estimate the Btu value of the wood burned is that the amount of empty space between the stacked logs may vary from 12 to 40 percent of the volume. Moisture content may vary from 20 percent in dried wood to 50 percent in green wood. (Moisture reduces the useful Btu output because energy is used in driving off the moisture). Finally, some tree species contain twice the Btu content of species with the lowest Btu value. Generally, hard woods have greater Btu value than soft woods. Wood is converted to Btu at the rate of 20 million Btu per cord, which is a rough average that takes all these factors into account.

Wood energy
Wood and wood products used as fuel, including round wood (cord wood), limb wood, wood chips, bark, saw dust, forest residues, charcoal, pulp waste, and spent pulping liquor.

Wood pellets
Saw dust compressed into uniform diameter pellets to be burned in a heating stove.

World Bank
The World Bank is an organization that, just like the IMF, was set up after World War2 inline with the Marshall Plan. It is an international organization that offers loans, gifts and technical support to help developing countries implement their plans for combating poverty. During the Cold War, the bank financed development projects to keep poor regions within the Western capitalist range of influence. The organization is a part of the United Nations and works according to the ‘one dollar, one vote’ principle, which means that control is divided in proportion to the money contributed.

WTO
The World Trade Organization is an inter-governmental organization with supranational characteristics. The body was set up in 1995 and is a continuing part  of the GATT that was set up in Geneva in 1923. Its tasks are the promotion of international trade, solving trade conflicts and eliminating trade barriers.

X

Xetra
The Xetra system is one of the trading systems used on the EEX Spot Markets.

Y

Yellowcake
A natural uranium concentrate that takes its name from its color and texture. Yellowcake typically contains 70 to 90 percent U3O8 (uranium oxide) by weight. It is used as feedstock for uranium fuel enrichment and fuel pellet fabrication.

Z

Zeebrugge
Belgian sea port, which is also the physical hub for gas delivery in Belgium.