There are many electric and gas energy terms with which site selectors may not be familiar. For this reason, we have provided this glossary of the most commonly used terms site locators are likely to encounter in dealing with utilities.

General Utility Terms
Electric Terms
Gas Terms

General Utility Terms
Bundled Service

Typically, utility service (gas & electric) that involves the local utility selling the energy and delivering it to a customer.

Delivery Service

Typically referred to utility service (gas & electric) that involves the local utility only delivering the energy to a customer. The energy is secured through a 3rd party source.


The elimination of some or all regulations from a previously regulated industry or sector of an industry.

Demand Charge

That portion of the consumer’s bill for electric service based on the consumer’s maximum electric capacity usage and calculated based on the billing demand charges under the applicable rate schedule.

Energy Service Provider

An energy entity that provides service to a retail or end-use customer.

Firm Service

A service option that prohibits the utility from curtailing gas or electric service, barring equipment failures, “force majeure”
outages, or other reasons beyond the utility’s control.

Interruptible or Curtailable Rate

A special electricity or natural gas arrangement under which, in return for lower rates, the customer must either reduce energy demand on short notice or allow the electric or natural gas utility to temporarily cut off the energy supply for the utility to maintain service for higher priority users. This interruption or reduction in demand typically occurs during periods of high demand for the energy (summer for electricity and winter for natural gas).

ISO (Independent System Operator)

A 3rd party entity that controls/operates the electric transmission system, usually for multiple utilities in a state or multi-state area.

IPP (Independent Power Producer)

Generation built and operated by an entity other than a regulated utility. Output is usually injected into the power transmission system for resale.

Off-peak Usage

Many utilities offer billing structures that establish different charges for customer usage based on time-of-day use. For utilities that utilize this structure, off-peak charges are lower than on-peak charges. Special metering is usually required.

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-peak Usage

Many utilities offer billing structures that establish different charges for customer usage based on time-of-day use. For utilities that utilize this structure, on-peak charges are higher than off-peak charges. Special metering is usually required.


Any point on or directly interconnected with a transportation, storage, or distribution system operated by a natural gas company.

On-system Sales

Sales to customers where the delivery point is a point on, or directly interconnected with, a transportation, storage, and/or distribution system operated by the reporting company.

Peak Demand

The maximum load during a specified period of time.

Peaking Capacity

Capacity of generating equipment normally reserved for operation during the hours of highest daily, weekly, or seasonal loads. Some generating equipment may be operated at certain times as peaking capacity and at other times to serve loads on an around-the-clock basis.

PUC (Public Utility Commission)

The independent state governmental organization that oversees, monitors and approves pricing/policies of regulated utilities.

Rate Case

A proceeding, usually before a regulatory commission, involving the rates to be charged for a public utility service.


The governmental function of controlling or directing economic entities through the process of rulemaking and adjudication.

Regulation, Procedures, and Practices

A utility commission carries out its regulatory functions through rulemaking and adjudication. Under rulemaking, the utility commission may propose a general rule of regulation change. By law, it must issue a notice of the proposed rule and a request for comments is also made; the Federal Energy Regulatory Commission publishes this in the Federal Register. The final decision must be published. A utility commission may also work on a case-by-case basis from submissions from regulated companies or others. Objections to a proposal may come from the commission or intervenors, in which case the proposal must be presented to a hearing presided over by an administrative law judge. The judge’s decision may be adopted, modified, or reversed by the utility commissioners, in which case those involved can petition for a rehearing and may appeal a decision through the courts system to the U.S. Supreme Court.


This term applies to defined policies and pricing mechanisms that are in use by regulated utilities. Typically approved by regulators, tariffs specify cost structures and terms of service for utility customers.
Third Party Supply: When a customer’s energy (gas & electric) is secured from sources other than the local utility. Typically, the local utility’s role is to deliver the energy to the customer (end user).

Electric Terms
Backup Power

Utility engineered systems that provide power in the event of a primary power loss if regular electric systems fail.

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.

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.


The production of electrical energy and another form of useful energy (such as heat or steam) through the sequential use of energy.
Connected Load: Measured in kW or kVa, the sum of all electrical equipment at a customer’s location if every electric device is running (at maximum) at the same time.

Demand Interval

The time period during which flow of electricity is measured (usually in 15-, 30-, or 60-minute increments.)


Having a meter to measure peak demand (in addition to total consumption) during a billing period. Demand is not usually metered for other energy sources.


A term used by most utilities that refer to low voltage electric lines. These lines usually serve small businesses and feed residential areas.

Dual Feed

When a customer is served by two electric lines, usually from different substations.

Looped Line

An electric line that is connected at both ends to separate sources, usually to two different substations.

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.

Kilowatt (kW)

One thousand watts.

Kilowatt-hour (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.

Load Factor

The ratio of the average load to peak load during a specified time interval.

Peaker Plant

An electric generating plant that does not operate continually. These are usually plants that utilize a high-cost fuel (such as natural gas) and only operate when market prices of electricity are high.

Power Factor

The ratio of real power (kilowatt) to apparent power kilovolt-ampere for any given load and time.

Primary Metering

Used when the customer’s energy usage is metered before energy flows through the transformer (high rather than low voltage).

Radial Line

An electric line that is only connected at one end, usually at a substation.

Rate Schedule (electric)

A statement of the financial terms and conditions governing a class or classes of utility services provided to a customer. Approval of the schedule is given by the appropriate rate-making authority.

Real-Time Pricing (RTP)

A service option that is offered by many utilities that bases energy charges on hourly market prices. There are 8,760 different energy pricing points in any given year. This can be viewed as “spot market” pricing.

Redundant Power

When a customer is served by two or more electric lines and/or has on-site generators.


Facility equipment that switches, changes, or regulates electric voltage.


A set of transmission lines of voltages between transmission voltages and distribution voltages. Generally, lines in the voltage range of 34.5 kV to 69 kV.


A devise that is used to reduce (“step down”) voltage on electric lines (i.e. from primary to secondary voltage).


A term used by most utilities that refer to very high voltage electric lines (designed to transmit electricity over long distances).

Gas Terms
BTU (British Thermal Unit)

The abbreviation for British Thermal Unit(s): A unit of energy used to describe heat value (energy content) of fuels and the power of heating and cooling systems. When used as a unit of power, BTU per hour (BTU/h) is understood.

BTU Conversion Factors

BTU conversion factors for site energy are as follows:
Electricity: 3,412 BTU/kilowatthour
Natural Gas: 1,031 BTU/cubic foot
Fuel Oil No.1: 135,000 BTU/gallon
Kerosene: 135,000 BTU/gallon
Fuel Oil No.2: 138,690 BTU/gallon
LPG (Propane): 91,330 BTU/gallon
Wood: 20 million BTU/cord

Cubic Foot (cf)

A unit used to define the volume of natural gas – the volume of a cube with sides of 1 foot in length.


A standard measurement used for natural gas volumes. 1 Dekatherm equals 1 MCF or 10 Therms of gas and contains approximately 1,000,000 BTU of energy (varies with gas quality).

Local Distribution Company (LDC)

The regulated natural gas utilities that take natural gas from interstate pipelines and deliver it to retail customers (end users).

Interstate Pipeline

A natural gas transmission line that crosses state boundaries and is owned and operated by independent companies that deliver gas from the well heads (source) to the local utilities and other wholesale customers.

MCF (one thousand cubic feet)

A standard measurement used for natural gas volumes. 1 MCF equals 1 Dekatherm or 10 Therms of gas and contains approximately 1,000,000 BTU of energy (varies with gas quality).

MMBTU (one million BTU)

A measurement used for natural gas energy content.
1 MMBTU contains 1,000,000 BTU of energy. To convert to volumes, 1 MMBTU equals approximately 1MCF or 1 Dekatherm or 10 Therms of gas (varies with gas quality).

Regulator (gas)

A devise that is used to reduce gas pressure.

ThermBundled Service

A standard measurement used for natural gas volumes. 1 therm equals 100 cubic feet of gas and contains approximately 100,000 btu of energy (varies with gas quality).