Below is an alphabetic list of energy-related words and expressions.
American Option
An option which can be exercised on each day of trading until the last day of trading.
Ampere A unit of measure for an electrical current. The amount of current that flows in a circuit at an electromotive force of one Volt and at a resistance of one Ohm. Abbreviated as amp. It is like using cubic feet per second to measure the flow of water. For example, a 1,200 watt, 120-volt hair dryer pulls 10 amperes of electric current (watts divided by volts).
Arbitrage The simultaneous purchase of a commodity or derivative in one market and the sale of the same, or similar, commodity or derivative in another market in order to exploit price differentials.
Area Load
The total amount of electricity being used at a given point in time by all consumers in a utility's service territory.
Average CostThe revenue requirement of a utility divided by the utility's sales. Average cost typically includes the costs of existing power plants, transmission, and distribution lines, and other facilities used by a utility to serve its customers.
Balancing Market A market system for maintaining the operational balance between consumption and generation of electricity in the overall power system in real time.
BarrelA unit of volume equal to 42 U.S. gallons. One barrel weights 306 pounds or 5.80 million Btu of crude oil. Barrel is abbreviated as bbl.
Base Load
Characterizes the type of load for the delivery of electricity or the procurement of electricity with a constant output over 24 hours of each day of the delivery period.
Biofuels Liquid fuels and blending components produced from biomass feedstocks, used primarily for transportation.
Biomass Any organic material which is available on a renewable basis, including agricultural crops and agricultural wastes and residues, wood and wood wastes and residues, animal wastes, municipal wastes, and aquatic plants.
Boiling Water Reactor A nuclear reactor in which water is allowed to boil in the core. The resulting steam is used to drive a turbine generating electric power.
British thermal unit (Btu) The amount of heat required to raise the temperature of one pound of water one degree Fahrenheit; equal to 252 calories. British thermal unit is abbreviated as Btu.
Call optionAn option which authorizes the buyer to buy a specific number of the underlying security at the exercise price.
Carbon Dioxide A colorless, odorless noncombustible gas with the formula CO2 that is present in the atmosphere. It is formed by the combustion of carbon and carbon compounds and by respiration
Cash Settlement An exclusive financial fulfilment of transactions is called cash settlement.
CDM (Clean Development Mechanism)CDM is a project based mechanism in the international emission trading system based on article 12 of the Kyoto Protocol. In CDM Projects, a company from one country (i.e. an industrialized country) invests in an emission reduction project that is carried out in another country (i.e. a developing country). From 2008 onwards the reduced amount of emissions in the host country is credited to the investing country or the investing company. CDM Projects are registered and certified by the United Nations Framework Convention on Climate Change (UNFCCC).
CER (Certified Emission Reduction)CERs are generated by Clean Development Mechanism (CDM) Projects. One CER corresponds to a carbon credit of one tonne CO2 equivalent. Since 2008 CERs can be credited up to a certain percentage of the total reduction liabilities of operating facilities within EU ETS.
Clearing Financial and physical settlement of transactions as well as collateralisation of transactions
Clearing House An institute which acts as a central counterparty for transactions (CCP). The clearing house organises the accounting of receivables and liabilities, the delivery of the transactions and the collateralisation of the transactions.
Clearing Member Participant in the clearing procedure who has a clearing license.
Coal A fossil fuel formed by the breakdown of vegetable material trapped underground without access to air.
Coal-Fired Power Plant
A power plant that uses coal as the fuel to generate electricity.
Cofiring The process of burning natural gas in conjunction with another fuel to reduce air pollutants.
Cogeneration The production of electrical energy and another form of useful energy (such as heat of steam) through the sequential use of energy.
Conversion Factors A number that translates units of one measurement system into corresponding values of another measurement system.
Day-Ahead Market
Part of the spot market where a commodity is tradable one day before delivery.
Derivatives
Financial instruments including forwards, futures, options and swaps, whose value is based on (or derived from) an underlying asset, index or reference rate.
Distillate Fuel Oil A general classification for one of the petroleum fractions produced in conventional distillation operations. It includes diesel fuels and fuel oils.
Electricity A form of energy characterized by the presence and motion of elementary charged particles generated by friction, induction, or chemical change.
Electricity Generation The process of producing electric energy or the amount of electric energy produced by transforming other forms of energy, commonly expressed in kilowatthours (kWh) or megawatthours (MWh).
Electric Power The amount of energy produced per second. The power produced by an electric current.
Emission A discharge or something that is given off; generally used in regard to discharges into the air or releases of gases to the atmosphere from some type of human activity.
Energy The ability to do work or the ability to move an object. Electrical energy is usually measured in kilowatthours (kWh), while heat energy is usually measured in British thermal units (Btu).
Energy Efficiency Refers to activities that are aimed at reducing the energy used by substituting technically more advanced equipment, typically without affecting the services provided.
European Union Emission Trading Scheme EU-ETSA policy introduced across Europe in January 2005 as first international emission trading system. The first trading period of the EU ETS expired at the end of 2007, the second trading period takes place from 2008 until 2012.
EUA 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.
European Option
An option which can only be exercised on the last day of trading.
Fission The splitting apart of atoms. This splitting releases large amounts of energy and one or more neutrons. Nuclear power plants split the nuclei of uranium atoms in a process called fission. See
Fossil Fuels Fuels (coal, oil, natural gas, etc.) that result from the compression of ancient plant and animal life formed over millions of years.
Fuel Any material that can be burned to make energy.
Fuel Oil An oil that is used for fuel and that usually ignites at a higher temperature than kerosene.
Fusion When the nuclei of atoms are combined or "fused" together. The sun combines the nuclei of hydrogen atoms into helium atoms in a process called fusion. Energy from the nuclei of atoms, called "nuclear energy" is released from fusion.
Future A future is the binding contractual obligation to buy (buyer of futures) or to deliver (seller of futures) a specified amount of a commodity at a specified price during a specified period of time in the future (delivery period).
Gallon A measure of volume equal to 4 quarts (231 cubic inches). One barrel equals 42 gallons.
Gas (1) A non-solid, non-liquid (as hydrogen or air) substance that has no fixed shape and tends to expand without limit. (2) A state of matter in which the matter concerned occupies the whole of its container irrespective of its quantity. Includes natural gas, coke-oven gas, blast furnace gas, and refinery gas.
Gasoline 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. <
Gas Turbine Plant A plant in which the prime mover is a gas turbine.
Generator A device that turns mechanical energy into electrical energy. The mechanical energy is sometimes provided by an engine or turbine.
Generating Capacity The amount of electrical power a power plant can produce.
Geothermal Energy The heat energy that is produced by natural processes inside the earth. It can be taken from hot springs, reservoirs of hot water deep below the ground, or by breaking open the rock itself.
Global Warming An increase in the near surface temperature of the Earth.
Greenhouse Effect The effect of the Earth's atmosphere, due to certain gases, in trapping heat from the sun; the atmosphere acts like a greenhouse.
Greenhouse Gases Gases that trap the heat of the sun in the Earth's atmosphere, producing the greenhouse effect. The two major greenhouse gases are water vapor and carbon dioxide.
Grid The layout of an electrical distribution system.
Hydroelectric Power Plant A power plant that uses moving water to power a turbine generator to produce electricity.
Hydrogen A colorless, odorless, highly flammable gaseous element. It is the lightest of all gases and the most abundant element in the universe, occurring chiefly in combination with oxygen in water and also in acids, bases, alcohols, petroleum, and other hydrocarbons.
Hydropower Energy that comes from moving water.
Induction The process of producing an electrical or magnetic effect through the influence of a nearby magnet, electric current, or electrically charged body.
Intra-Day Market
Part of the spot market on which the trading participants can trade a commodity up to one hour prior to the beginning of the delivery.
Kilowatt A unit of power, usually used for electric power or to energy consumption. A kilowatt equals 1000 watts.
Kilowatthour (kWh) A measure of electricity defined as a unit of work or energy, measured as 1 kilowatt (1,000 watts) of power expended for 1 hour. One kWh is equivalent to 3,412 Btu or 3.6 million joules.
Liquefied Petroleum Gas (LPG)
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.
Load The power and energy requirements of users on the electric power system in a certain area or the amount of power delivered to a certain point.
Marginal Cost
The sum that has to be paid the next increment of product of service. The marginal cost of electricity is the price to be paid for kilowatt-hours above and beyond those supplied by presently available generating capacity.
Mark-to-Market
With the help of the mark-to-market procedure profits and losses from open futures positions, which are caused by price changes in the futures, are calculated on a daily basis.
Market Based Price
A price set by the mutual decisions of many buyers and sellers in a competitive market.
Market Maker
A market maker is a trading participant who holds a bid and an ask order (quote) simultaneously for a minimum period of time on the exchange trading day. Market makers serve to ensure basic liquidity.
Mechanical Energy The energy of motion used to perform work.
Megawatt A unit of electrical power equal to 1000 kilowatts or one million watts.
Methane A colorless, flammable, odorless hydrocarbon gas (CH4) which is the major component of natural gas.
Natural Gas An odorless, colorless, tasteless, non-toxic clean-burning fossil fuel. It is usually found in fossil fuel deposits and used as a fuel.
Natural Gas Liquids (NGL)
Substances that can be processed as liquids out of natural gas by absorption or condensation.
Non-biogenic wasteWaste made from fossil materials or materials of non-biological origin, such as plastics, and tire-derived fuels.
Nonrenewable fuels Fuels that cannot be easily made or renewed. We can use up nonrenewable fuels. Oil, natural gas, and coal are nonrenewable fuels.
Nuclear Energy Energy that comes from splitting atoms of radioactive materials, such as uranium.
Ohm The unit of resistance to the flow of an electric current.
Option Binding contractual obligation. The right to buy (call option, call) or to sell (put option, put) a certain number of the underlying security at the exercise price on the exercise day.
OTC marketOTC means "over-the-counter" and indicates the trade that takes place directly between the players in a market, i.e. not on an exchange.
Peak Load Characterizes the load type for the delivery or procurement of electricity at a constant load over 12 hours from 08:00 am until 08:00 pm on every working day (Monday to Friday) during a delivery period.
Petrochemicals Organic and inorganic petroleum 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 Generally refers to crude oil or the refined products obtained from the processing of crude oil (gasoline, diesel fuel, heating oil, etc.)
Photovoltaic Cells A device, usually made from silicon, which converts some of the energy from light (radiant energy) into electrical energy. Another name for a solar cell.
Power Degradation The loss of power when electricity is sent over long distances.
Power-Generating Efficiency The percentage of the total energy content of a power plant’s fuel which is converted into electric energy. The remaining energy is lost to the environment as heat.
Power Plant
A facility where power, especially electricity, is generated.
Pressurized Water Reactor
A reactor in which water, heated by nuclear energy, is kept a high pressure to prevent the water from boiling. Steam is then generated in a secondary coolant loop.
Pumped Storage A method of storing and producing electricity to supply high peak demands by moving water between reservoirs at different elevations.
Put option
An options contract which authorizes the buyer to sell a specific number of the underlying security at the exercise price on the exercise day.
Radiant Energy
Any form of energy radiating from a source in waves.
Radiation Any high-speed transmission of energy in the form of particles or electromagnetic waves.
Radioactive Element An element whose atoms have unstable nuclei that stabilizes itself by giving off radiation.
Radioactive Waste Materials left over from making nuclear energy.
Reactor Core Part of a nuclear power station - the structure inside which fission occurs in millions of atomic nuclei, producing huge amounts of heat energy.
Recycling The process of converting materials that are no longer useful as designed or intended into a new product.
Refinery An industrial plant that heats crude oil so that is separates into chemical components, which are then made into more useful substances.
Refined Petroleum Products Refined petroleum products include but are not limited to gasoline, kerosene, distillates (including No. 2 fuel oil), liquified petroleum gas, asphalt, lubricating oils, diesel fuels, and residual fuels.
Renewable Energy Sources Fuels that can be easily made or renewed. We can never use up renewable fuels. Types of renewable fuels are hydropower (water), solar, wind, geothermal, and biomass.
Semiconductor Any material that has a limited capacity for conducting an electric current. Semiconductors are crystalline solids, such as silicon, that have an electrical conductivity between that of a conductor and an insulator.
Settlement Settlement is the financial and physical fulfilment of a transaction.
Settlement Day Days on which the financial and/or physical settlement of the transactions is effected.
Settlement Price Price for each individual futures and options contract which is established by the exchange on a daily basis <
Solar Cell An electric cell which changes radiant energy from the sun into electrical energy by the photovoltaic process.
Solar Energy The radiant energy of the sun, which can be converted into other forms of energy, such as heat or electricity.
Spent Fuel Irradiated fuel that is permanently discharged from a nuclear reactor.
Spread The range between best bid and best ask is called spread.
Steam Generator A generator in which the prime movers (turbines) are powered by steam.
Superconductivity The abrupt and large increase in electrical conductivity exhibited by some metals as the temperature approaches absolute zero.
Thermal Energy The total potential and kinetic energy associated with the random motions of the molecules of a material.
Transformer A device which converts the generator's low-voltage electricity to higher-voltage levels for transmission to the load center, such as a city or factory.
Transmission The movement or transfer of electric energy over an interconnected group of lines and associated equipment between points of supply and points at which it is transformed for delivery to consumers or is delivered to other electric systems. Transmission is considered to end when the energy is transformed for distribution to the consumer.
Transmission Line A set of conductors, insulators, supporting structures, and associated equipment used to move large quantities of power at high voltage, usually over long distances between a generating or receiving point and major substations or delivery points.
Transmission SystemAn interconnected group of electric transmission lines and associated equipment for moving or transferring electric energy in bulk between points of supply and points at which it is transformed for delivery over the distribution system lines to consumers or is delivered to other electric systems.
TSO Transmission System Operator
TTF
The Title Transfer Facility, more commonly known as TTF, is a virtual trading point for natural gas in the Netherlands.
Turbine A device which blades, which is turned by a force, e.g. that of wind, water , or high pressure steam. The mechanical energy of the spinning turbine is converted into electricity by a generator.
Uranium Fuel Cycle The series of steps involved in supplying fuel for nuclear power reactors. It includes mining, refining, the making of fuel elements, their use in a reactor, chemical processing to recover spent (used) fuel, re-enrichment of the fuel material, and remaking into new fuel elements.
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 = 1 kg 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 acquire and/or give up as they move between the two conductors. <
Water Turbine A turbine that uses water pressure to rotate its blades.
Watt A metric unit of power, usually used in electric measurements, which gives the rate at which work is done or energy used.