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Electricity and Natural Gas

 (Terms and Definitions)

A glossary to assist you with understanding energy terms and meanings.


An individual or entity that gathers, organizes, and classifies things into groups. In our case, we bring our clients together to get bids for energy on the entire load.


Equalizing the volumes of gas withdrawn from a pipeline system with the volumes of gas injected into the pipeline. Penalties may be assessed for transportation imbalances beyond specified tolerances.

Base Load

The minimum level of demand on an electricity supply system over 24 hours. Base load power sources are those plants, which can generate dependable power consistently meet demand.

British Thermal Unit (BTU)

Common measurement of natural gas. Defined as the amount of heat required to raise the temperature of 1 lb. of liquid water by 1 at a constant pressure of one atmosphere.


An energy broker is an individual or company acting on someone's behalf to obtain the best deal or contract terms.

Burner Tip

The end of the transportation of natural gas from the wellhead, and the point of consumption.


The net capacity factor of a power plant is the ratio of its actual output over a period of time, to its potential output if it were possible for it to operate at full nameplate capacity indefinitely.

Carbon Footprint

The total set of greenhouse gas (GHG) emissions caused by an organization, event, product, or person.

Carbon Offsetting

Reducing a carbon footprint.

City Gate (City Station Town Border Station)

Location at which natural gas ownership passes from one party to another, neither of which is the ultimate consumer; the point at which interstate and intrastate pipelines sell and deliver natural gas to local distribution companies.

Degree Days

Used in the energy industry as a representation of outside temperatures and how it relates to energy consumption.

Demand Response

A voluntary program that compensates end-use (retail) customers for reducing their electricity use (Load), when requested, during periods of high power prices or when the reliability of the grid is threatened.

Demand Side Management

The costs incurred by the utility to achieve the capacity and energy savings from the demand side management program. Costs incurred by consumers or third parties are excluded. The costs are to be reported in nominal dollars in the year in which they are incurred, regardless of when the savings occur.


A market where consumers have their choice of electricity generation suppliers or natural gas suppliers.

Energy Information Administration (EIA)

An Agency with the Department of Energy (DOE) that provides policy-neutral data, forecasts and analyses to promote sound policymaking, efficient markets, and public understanding regarding energy and its interaction with the economy and the environment.


The Electric Reliability Council of Texas (ERCOT) operates the electric grid and manages the deregulated market for most of Texas.


Relating to the heat produced inside Earth.

Gigawatt (GW)

Unit of electric power equal to one billion watts, one thousand megawatts, or 1.34 million horsepower enough to supply a medium city.


Network of synchronized power providers and consumers that are connected by transmission and distribution lines and operated by one or more control centers.

Heat Rate

Used to calculate how efficiently a generator uses heat energy. It is expressed as the number of BTUs of heat required to produce a kilowatt-hour of energy. Power / Natural gas = Market Implied Heat Rate.


A position established in one market in an attempt to offset exposure to price changes or fluctuations with the goal to minimize risk.

Hydraulic Fracturing (Fracking)

The process of pumping fluid under pressure underground to fracture rock containing oil or gas. Hydraulic fracturing creates fissures that increase the surface area in order to allow greater quantities of hydrocarbons to flow out of a reservoir.

Kilowatt Hour (KWH)

A measure of electrical energy equivalent to a power consumption of 1,000 watts for 1 hour.

Load Factor

Average consumption divided by the peak power over a period of time.


One thousand cubic feet of natural gas.


One million watts, a watt being a unit of measure of power, or how fast energy is used. Megawatts are typically used to describe large quantities of power, such as the power output of an electrical generating plant.

Peak Demand

Refers to a historically high point in the sales record of a particular product.

Price Cap

Sets a cap on the price that the utility provider can charge.

Renewable Energy Credits (RECs)

Tradeable, non-tangible energy commodities in the U.S. that represent proof that 1 MWh of electricity was generated from an eligible renewable energy resource.

Retail Energy Provider (REP)

A private supplier that provides energy as part of a competitive retail energy market.


A company in the electric or natural gas industry (often a public utility) that engages in generation and distribution in a regulated market.


A dekatherm (dth) is a unit of energy used primarily to measure natural gas, developed in about 1972 by the Texas Eastern Transmission Corporation, a natural gas pipeline company. It is equal to 10 therms of 1,000,000 British thermal units (MMBtu) or 1.055 GJ.

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