Glossary

Aggregators: A collection of energy consumers able to pool their collective resources, for example to offer consumption reduction as part of a Demand Side Response initiative.

Annual Quantity (AQ): The estimated annual consumption of gas per site, per year, in kWh derived from historic consumption.

Assistance for areas with high electricity distribution costs (AAHEDC): AAHEDC replaces an earlier arrangement, commonly referred to as 'Hydro Benefit'. This is a charge recovered from all consumers to reduce distribution charges in Northern Scotland.

BACS: Banking Automated Clearing System (BACS) is an electronic system to make payments directly from one bank account to another.

Balancing Services Use of System charge (BSUoS): Is paid by the Supplier to the System Operator (SO) for the cost of balancing the system. It pays for the skills, tools and services the SO needs to balance supply and demand in real time. BSUoS charges depend on the balancing actions taken each day and are known after they have happened. This can be quite a volatile charge.

Behind the meter generation (BtMG): Behind the meter generation, typically from CHP, diesel stand-by generation is used on-site reducing the customer's metered consumption from the main network allowing the site to respond to network operator price signals and contribute to other Demand Side Response services. Where permitted BtMG may be able to export any excess. BtMG can also refer to energy (including that from renewables) that’s generated for use onsite via an internal ‘private wire’ infrastructure, so bypassing the need to connect to the distribution network.

BEIS (Department of Business, Energy and Industrial Strategy): BEIS is a government department created in July 2016. It merged the former Department of Energy and Climate Change (DECC) with the Department for Business, Innovation and Skills (BIS).

Capacity (kVa): The maximum electricity supply to your site that has been agreed with your local Distribution Network Operator (DNO). Also known as Total Power or maximum import capacity (MIC).

 

Capacity Mechanism (CM): Introduced as part of the government’s Electricity Market Reform (EMR) measures, the CM is designed to make sure we have sufficient power available to meet our future needs. It operates as an annual ‘Capacity Market’ auction to procure the majority of the UK’s required energy capacity four years in advance, with a top-up auction one year ahead of delivery.

Carbon Price Floor: A levy on carbon emissions paid by UK generators introduced by the government in April 2013.

Combined Heat and Power (CHP): The production of both heat and electricity from the same device or power plant. CHP refers to the process, and can be used with any fuel.

Climate Change Levy (CCL): Energy suppliers are required to charge and collect CCL on behalf of the government. It was introduced to encourage a reduction in consumption, and increase business energy efficiency. CCL is included as a separate component of the energy bill, and is calculated on the number of units/kWh of electricity and/or gas consumed. It is subject to the standard rate of VAT. CCL is only chargeable on business consumption of energy and current legislation provides for relief or exemption from CCL in certain circumstances. Customers eligible for reliefs, exemptions or the reduced rate of CCL must submit a Supplier CCL certificate to their energy supplier before any reduction or exemption can be applied to the energy bill.

Compensation scheme: This provides a refund from the government for eligible parties against the cost of certain energy-related levies and is paid for out of general taxation. For example, eligible Energy-Intensive Industries (EIIs) are currently able to claim compensation against a proportion of the Renewables Obligation (RO) and Feed in Tariff (FiT) costs (RO compensation to be replaced by an exemption scheme on 1 April 2018).

Contracts for Difference (CfD): This scheme is part of the government’s Electricity Market Reform (EMR) programme and provides a guaranteed income for low-carbon generators, providing long-term price certainty and increasing the business case for investment. It replaces the Renewables Obligation (for new generation projects) and the costs of the scheme are recovered from consumers via their energy bills.

Counterparty Body (CPB): The CPB oversees the running of the Contracts for Difference scheme, along with the System Operator.

Customer Contact Team (CCT): Our Customer Contact Team is your first point of contact for any queries about your npower Business Solutions account. You can get in touch by calling 0800 138 2322 or sending an email to .

Data Aggregator (DA): An organisation accredited by Elexon to carry out data aggregation services. The DA is responsible for passing consumption data from the Data Collector on to Elexon to aggregate for settlement purposes.

npower Business Solutions can provide Data Collection, Data Aggregation and Meter Operator services.

Data Collector (DC): An organisation accredited by Elexon to carry out data collection for Half Hourly (HH) meters. The DC is responsible for collecting and validating your metering data and forwarding it to your Data Aggregator (DA) and your supplier. You can choose your own DC provider, as long as they are accredited, and you must inform your energy supplier of your chosen DC provider.

Demand side response (DSR): This is an intervention by consumers to reduce electricity demand at times of system stress, or to respond to network operator price signals either by turning consumption down or switching instead to on-site generation.

Distributed generation (DG): Also known as embedded or dispersed generation, distributed generation describes an electricity generating plant connected to a local distribution network (including Behind the Meter Generation ) rather than the main transmission network.

Distribution Loss (DLOSS): This reflects the electricity, in excess of that consumed by each customer, which needs to be purchased to take account of electrical losses in each Distribution Network – these published losses vary from area to area and also by voltage.

Distribution Network Operator (DNO): There are 14 regional distributors. They are responsible for operating and maintaining the networks that connect electricity consumers to the national transmission system and provide interconnection with embedded generation.

Distribution Use of System (DUoS) charge: This is paid by suppliers to Distribution Network Operators (DNOs) for the cost of building and maintaining the local distribution network. Your DUoS charge may depend on: where on the local network you are; what voltage connection you need; when in the day you use the network; how much you consume. DUoS tariffs are published 15 months before the start of the charging year, e.g. tariffs for 2019/20 were published on 31 December 2017.

Electricity Central Online Enquiry Service (ECOES): A national database of electricity consumers that electricity suppliers can refer to, to check they have correct information about customers prior to transferring their supply.

Electricity Settlements Company (ESC): The ESC was set up as an independent body to oversee the running of the Capacity Mechanism.  has more information about this.

Elexon: The body set up under the BSC which compares the amount of electricity generators and supplier say they will produce or consume with the actual volumes. This includes overseeing the metering industry.

Emissions Trading Scheme (ETS): The ETS is an EU cap and trade scheme that seeks to limit overall greenhouse gas emissions. All large generators, manufacturers and other installations are allocated allowances which can then be traded if emissions fall below or exceed permitted levels.

Energy intensive industry (EII): Heavy electricity users like steel and chemical companies can apply for exemptions from some third party energy costs (eg. the RO, FiT or CfD) Currently, strict criteria govern which industries can be classified as an EII. To  from some of these costs, register directly with the Department of Business, Energy and Industrial Strategy (BEIS).

Electricity Market Reform (EMR): EMR describes the range of measures introduced by the Energy Act 2013 to support future energy supply and security and is made up of four elements:

Erroneous transfer (ET): The name given when a site’s energy supply is incorrectly registered to a new supplier. As soon as they are notified, the original and the new supplier will work together to transfer the site back to the original supplier, ensuring this occurs without any incurring any cost or loss of supply.

Estimated Annual Consumption (EAC): Forecast of consumption provided by your Data Collector based on historical meter reads.

Exemption scheme: An exemption provides a reduction in the overall cost of certain energy-related levies through electricity bills. For example, eligible energy-intensive industries are exempt from a proportion of Renewables Obligation and Contracts for Difference costs. The costs are recovered from all other consumers that are not classified as exempt.

Feed-in Tariffs (FiT): The FiT scheme is a government programme designed to promote the uptake of renewable and low-carbon electricity generation technologies. All larger suppliers are obliged to participate in the scheme as a mandatory FiT licensee and make generation payments to FiT generators registered to them. The cost of the scheme is then shared by all suppliers based on their market share through the levelisation process.

Flexible purchasing: A flexible purchasing contract enables customers to set their energy prices ‘flexibly’ at multiple points throughout their contract duration. Volume is split into clips (electricity) or tranches (gas) and prices for these can be purchased via a range of options. On a traditional electricity flexible purchasing contract, any ‘residual’ volume that falls outside these clip allocations is priced once a year in advance of supply. As an alternative, the volume outside the clips/tranches is priced into a Shape Risk Premium (for power or gas).

Gas Distribution Networks (GDN): GDNs transport gas from the main National Transmission System to consumers. There are currently eight GDNs in Great Britain which comprise twelve local distribution zones and you can .

Half-Hourly data (HH): HH data is collected from Half-Hourly meters.

Half-Hourly (HH) meter: HH meters are linked to a communications device that allows energy consumption data to be accessed remotely on a daily basis. This can then be used by suppliers to create accurate bills and also to populate energy management systems, so you can see what energy you are using, when and where.

Independent Gas Transporter (IGT): An independent company which looks after a gas supply network that is not connected to the National Grid. Some suppliers charge an additional amount if your gas is supplied by an IGT rather than the mains gas network. If your MPRN number is 10 digits long and starts with a 74, 75, 76 or 77, you’re supplied by an IGT and you can .

Kilowatt hour (kWh): Unit of measurement for gas and electricity consumption that equates to one kilowatt (kW) of power used for one hour. For example, a 100 watt light bulb used for ten hours will consume one kWh, while an appliance such as a kettle that uses three kilowatts of power would consume one kWh in 20 minutes. The number of kWh you have used within a given period are shown on your energy invoice and charged at a per kWh rate. If you know the number of kWh you use annually, this is usually the most accurate way to get a quote before switching suppliers. Please note, gas meters measure consumption in cubic meters, which are then converted into kilowatt hours for billing purposes.

Levy Control Framework (LCF): A mechanism that’s designed to keep government spending within budget, for example a LCF has been created to control spending on the Renewables Obligation, Contracts for Difference and small-scale Feed in Tariff schemes.

Line Loss Factor (LLF): A value that reflects the electricity that is lost in distribution at different voltages and times of day. See also Distribution Loss (DLOSS).

Line Loss Factor Class (LLFC): Line Loss Factor class is a three digit alpha numeric code used by DNOs to categorise customer types at different voltage levels and is used to identify the related DUoS charges for each meter point.

Load management: The process by which a customer can actively manage their energy consumption either by reducing demand from non-essential operations or equipment, or by switching instead to an onsite source of generation to ‘self-supply’ at times of system stress or to respond to network operator price signals (see also Demand Side Response).

Low Carbon Contracts Company (LCCC): The LCCC was set up as an independent body to oversee the running of the Contracts for Difference (CfD) scheme. The  has more information about this.

Low-carbon generator: This encompasses any source of low-carbon power generation, be it from a nuclear power station, a wind farm – or at the small-scale end, from a business or domestic property with solar panels on the roof.

Low voltage: (In the context of electricity connections), all voltage levels up to and including 1kV.

Meter Operator (MOP): An organisation appointed to maintain metering equipment. Any Half-Hourly meter must have a MOP contract.

Meter Point Administration Number (MPAN): An MPAN is a unique number that identifies the supply to your electricity meter. It’s 13 digits long and helps your energy supplier and other industry providers to keep track of the electricity supplied to your business premises. It’s often referred to as your ‘Supply Number’ or ‘S’ number on your electricity invoice.

Meter Point Reference Number (MPRN): A MPRN is a unique number that identifies the supply to your gas meter. It can be up to ten digits long and helps your energy supplier and other industry providers to keep track of the gas supplied to your business premises. It’s often referred to as an ‘M’ number on your gas invoice.

Meter Serial Number (MSN): An MSN is a number given to identify an actual meter. Your MSN relates to the physical meter that records your consumption and is connected to the MPRN for gas and MPAN for electricity.

Meter Time Switch (MTS): A three-digit code that reflects the various registers a meter may have, whether it is a single rate, day/night split, or even a seasonal time of day.

Micro-generation: The small-scale generation of heat and/or electricity from a low-carbon source, for example solar panels, micro wind turbines, micro combined heat and power or heat pumps.

Non-commodity charges: These relate to any charge outside the actual cost of the energy commodity (ie. electricity or gas) itself. For example, network and distribution charges and government levies such as the Climate Change Levy are all non-commodity charges.

Office of Gas and Electricity Markets (Ofgem): Regulator for gas and electricity businesses in Great Britain. For further information visit .

Network Peak demand: The times when National Grid experiences maximum demand for electricity supply on the grid.

Pass through / Non-pass through charges: If a charge is described as pass through, this usually means that the amount you pay is reflective of the cost to your supplier of that charge – so it may be variable and may be reconciled from time to time. A non-pass through charge (or fixed charge) means that you pay a fixed amount and the supplier takes the risk of forecasting what that charge will be. Pass through charges will always be shown separately on your bill, but fixed charges may be built into your overall rate.

Power Purchase Agreement (PPA): This is, as the name suggests, an agreement to purchase power from a generator that is exporting power on to the network. A PPA can be between a supplier and a generator, or a private arrangement between a business and a small-scale renewable generator.

Renewables Obligation (RO): The RO places an obligation on UK electricity suppliers to get an increasing proportion of their power from renewable sources. Companies do this through purchasing Renewable Obligation Certificates (ROCs) issued to an accredited generator for the renewable electricity they produce. The RO was closed to new renewable generation capacity on 31 March 2017. However, as the accreditation for generators to produce ROCs lasts 20 years, the RO will continue until 31 March 2037, with the cost passed through to customer bills.

Settlement and Agency charges: These charges are made by Data Collectors to retrieve meter reads or consumption data, Data Aggregators for industry settlement purposes and Meter Operators for maintaining the meter.

Smart Grid: A Smart Grid is an electricity network that can intelligently integrate the actions of all the users connected to it – generators, consumers and those that do both – in order to efficiently deliver sustainable, economic and secure electricity supplies.

Smart meter: Advanced gas and electricity metering technology that offers customers more information about, and control over, their energy use (such as providing information on total energy consumption in terms of value, not only volume), and/or allows automated and remote measurement.

Strike prices: The guaranteed amount generators will receive for low-carbon energy under the Contracts for Difference scheme, with different amounts allocated to different technologies.

Supplier Obligation: The framework that places responsibility on energy suppliers to meet the cost of government schemes such as Contracts for Difference and the Capacity Mechanism.

System Operator: The entity responsible for operating the GB transmission system and for entering into contracts with those who want to connect to and/or use the transmission system. National Grid is the GB Transmission System Operator.

Supply start date (SSD): The date your energy supplier is registered at the meter and begins supplying electricity and/or gas to your business premises.

Third-party charges: These refer to charges which licensed energy suppliers are required to pay to third parties by industry rules. These include charges and levies from network and distribution operators such as National Grid, and government schemes such as the Renewables Obligation (RO), Feed in Tariff (FiT) and Contracts for Difference (CfD). You can  on our website.

Transmission Loss (TLOSS): This charge reflects the electricity, in excess of that consumed by each customer, which needs to be purchased to take account of electrical losses in the transmission system.

Transmission Network Use of System (TNUoS) charge: The TNUoS charge recovers the cost of installing and maintaining the transmission system in England, Wales and Scotland, as well as offshore transmission systems.

For large businesses, charges were historically based entirely on consumption during the three peak Half-Hourly (HH) periods called Triads, that fell within November to February. However, as a result of the Targeted Charging Review (TCR), from April 2023, the model is now based 10% on peak consumption (calculated using Triads) and 90% on fixed charges across four different capacity/consumption bands per voltage level.

Triad: Prior to April 2023, Triads - the three Half-Hourly (HH) settlement periods with the highest system demand between November and February - were used to determine the full Transmission Network Use of System (TNUoS) charge. However, as a result of the Targeted Charging Review (TCR), since April 2023, Triads only make up the minority (10%) of the TNUoS charge, with the rest (90%) collected via a fixed residual charge across four different capacity/consumption bands per voltage level.

XOSERVE: A central data service provider for the gas industry. Xoserve helps to manage customer transfers between suppliers, supports accurate billing and deals with data queries.