Legalese – Electricity Industry Glossary of terms

Act
Electricity Act 1989 (amended by the Utilities Act 2000);

Authorised
In relation to any business or activity means authorised by licence or treated as granted under section 6 or by exemption granted under section 5 of the Act;

Authority
Gas and Electricity Markets Authority;

BETTA
British Electricity Trading and Transmission Arrangements;

BM Unit
Balancing Mechanism Unit (which can relate either to a generator or a demand customer);

BMA
Bond Market Association;

BSC
Balancing and Settlement Code;

BSC Agent
a person appointed to carry out discrete services under the BSC;

BSC Company
currently Elexon;

Buyers Replacement Costs
for EUETS is the ‘loss’ that Buyers suffer if Sellers fail to deliver;

Calculation Agent
Under B≻

CCL
Climate Change Levy;

CER
Certified Emission Reductions under the Clean Development Mechanism ("CDM") of the Kyoto Protocol;

CHP
Combined heat and power;

Code of Practice or CoP
a code of practice established by the BSC Panel in relation to metering equipment;

Co-firing
the combustion of biomass with coal at predominately coal-fired stations;

Compensation Threshold
the minimum amount where failure under GTMA does not give rise to payment of compensation;

Contract Party
under GTMA where one of the Parties acts for both on ECV;

Covered Transactions
Transactions subject to close out and netting;

CPMA
the Cross-Product Master Agreement prepared by BMA;

CUSC
Connection and Use of System Code – essentially the agreement between all persons using the Electricity Transmission System governing arrangements for connection to and use of this system;

Dark Green Spread
The margin between cost of coal/gas plus CO2 Allowances and sale price of electricity;

Dark Spread
The margin between cost of coal and sale price of electricity eg. 15MW per 5,000 Tonnes of Coal;

Data Collector
an agent appointed by an electricity supplier to retrieve, validate and process metering data from meters;

Distribution Code
the technical set of rules governing connection to and use of the physical Distribution Systems;

Distribution Network Operator or DNO
a licensed operator of a Distribution System;

Distribution System
an electricity network of electric lines below 275kV owned and operated by a licensed Distribution Network Operator;

ECV/Energy Contract Volumes
means, for a Settlement Period and/or Energy Account, a volume of electricity expressed in MW/h;

EEP
Excess Emissions Penalty;

EFET
European Federation of Energy Traders;

Elexon
agency running the Balancing and Settlement Code (BSC); the BSC Agency;

Energy Account
an account held by a party to the BSC for the purpose of accounting in Settlement for quantities of electricity;

EUETS
European Union Emissions Trading Scheme;

FOA
Futures and Options Association;

GB Transmission System
the system consisting (wholly or mainly) of high voltage electric wires owned or operated by transmission licensees within Great Britain;

Generating Unit
any apparatus which produces electricity;

GHG
Greenhouse Gases;

Grid Code
the technical set of rules governing connection to and use of the physical transmission system operated by NGET (formerly NGC);

GSP or Grid Supply Point
A substation where a Distribution System is connected to the Transmission System

GTMA
Grid Trade Master Agreement which is the industry standard agreement under which electricity is traded between generators and suppliers/traders;

IDNO
a licensed Independent Distribution Network Operator;

IETA
International Emissions Trading Association;

ISDA
International Swaps and Derivatives Association;

kW
kilowatt;

kW/h
kilowatt-hour;

LEC
Levy Exempt Certificate under the CCL;

Licence
a licence granted under s6 Electricity Act 1989 (as amended) – includes generation, transmission, distribution and supply;

MW
megawatt;

MW/h
megawatt hours;

NGET
National Grid Electricity Transmission plc (holder of the Transmission Licence);

Notification Agent
Notification Agent for a Grid Trade;

OFGEM
The Office of Gas and Electricity Markets;

Options Annex
published by FOA as an annex to the GTMA to cover Options;

Outage
an incident causing a Generating Unit to cease export to the Transmission or Distribution System;

Persistent Notification Default
the failure of [generator] and/or [Supplier/Trader] to meet obligations under GTMA such that the payments due exceed the Compensation Threshold;

Registrant
the person who is registered in relation to an electricity meter;

REGO
Renewable Energy Guarantee of Origin (EU based but no current value in the UK);

RO
Renewables Obligation made under the Renewables Obligation Order 2006;

ROC
Renewables Obligation Certificate issued by the Authority and representing one MW of output from a qualifying generating station;

Settlement
the determination and settlement of amounts payable in respect of Trading Charges in accordance with the BSC;

Settlement Disruption Event
means per EUETS – cannot close a Transaction due to system failure;

SO
System Operator (NGET);

Spark Spread
the margin between cost of gas and sale price of electricity;

Trading Charges
charges levied pursuant to the BSC;

Transmission System
the system of Extra High Voltage Electricity Lines owned and operated by NGET pursuant to a Transmission Licence;

VTA Quantity
means in relation to a EUETS Transaction the number of Vintage Trade Allowances that Seller has agreed to deliver to Buyer of the applicable Specified Compliance Period (ie. Phase 1 (3 years) or Phase 11 (5 years)).