Electric Choice - Glossary of Standard Terms

You are now able to shop for power. This move toward electric utility competition, power supply choice, electric deregulation, retail wheeling - whatever you want to call it - comes with a vocabulary all its own. To help you prepare for the coming changes, here are some commonly used customer choice terms:

Aggregator
A buyers' group that signs up large numbers of consumers and bargains on their behalf for the lowest possible electricity costs. Electric co-ops have always acted as aggregators to get the best prices for their members.

Automated Meter Reader (AMR)
The reading of meters from a location remote from where the meter is installed. Telephone, radio, and electric power lines are used to communicate meter reading to remote locations.

Base Rate
"Standard" rate charged to utility customers for general services but not including utility expenses. This rate is used as the basis for setting discounts and special prices.

Broker
A firm that acts as a "middle man" in the sale and purchase of electricity, but never owns the electricity and generally does not own power plants.

Competitive Transition Charge (CTC)
A charge on a customer's bill designed to recover an electric utility's stranded cost.

Demand
A measure of customer or system load requirements over a measured period of time.

Deregulation
Removal or relaxation of regulations or controls governing a business or service.

Distribution
The local wires, transformers, substations and other equipment used to distribute and deliver eletricity to end-use consumers from the high-voltage transmission lines.

Electric Cooperative
A non-profit, customer-owned electric utility, responsible for distributing power in rural areas. Electric co-ops are governed under Title 15 (Corporations and Unincorporated Associations) of the Pennsyvania Consolidated Statutes (law).

Electric Distribution Company (EDC)
The company that owns the power lines and equipment necessary to deliver purchased electricity to the customer.

Electric Generation Supplier (EGS)
A frim, broker, marketer, aggregator or utility generation subsidiary that sells electricity to customers across the transmission and distribution system of an electric distribution company.

Generation
Production of electricity from a power plant using fuels such as coal, oil, natural gas, nuclear and hydro.

Investor-Owner Utility (IOU)
A utility company owned and operated by private investors as opposed to governmental or cooperative-type ownership.

Kilowatt (kW)
(1) A measure of demand for power during a preset time--minutes, hours, days, months; (2) 1,000 watts--Ten 100 watt light bulbs use one kW of electric power.

Kilowatt-Hour (kWh)
A measure of electricity consumption equivalent to the use of 1,000 watts of power over a period of one hour.

Marketer
A company that buys and resells electricity, but typically does not own power plants.

Off-peak / On-peak Period
Blocks of time when energy demand and price is low (off-peak) or high (on-peak).

Pilot
A utility program offering a limited group of customers their choice of certified or licensed energy suppliers on a one year minimum trial basis.

Electric Choice
The common name given to the programs and procedures involved in allowing Pennsylvania's electric cooperative consumer-members to shop for power.

Public Utility Commission (PUC)
The state regulatory agency that was formed to provide policy guidance and direction in the area of utility rates and service, i.e., balance the benefits received by consumer, shareholder, and utility and to ensure that consumers receive safe, adequate service at reasonable and fair prices from investor-owned utility companies.

Reliability
The providing of adequate and dependable generation, transmission and distribution service.

Restructuring
The reorganization of traditional monopoly electric service to allow operations and changes to be separated or "unbundled" into generation, transmission, distribution and other service. This will permit customers to buy generation services from competing suppliers.

Retail Wheeling
A utility company is required to transport electricity from a generating plant it does not own directly to its retail customers. This gives retail customers the ability to purchase electricity from sources they chose.

Rural Electric Cooperative (REC)
A non-profit, customer-owned electric utility, responsible for distributing power in rural areas.

Shopping Gredit
The price per kilowatt-hour for electric generation a power supplier has to beat for a consumer to save money.

Stranded Investments / Stranded Costs
A utility investment, such as in facility and equipment, that is not supported by market prices.

Supplier (Electricity Supplier)
A person or corporation, generator, broker, marketer, aggregator or any other entity, that sells electricity to customers, using the transmission or distribution facilities of an electric distribution company (EDC).

Transition Charge
A charge on every customer's bill designed to recover an electric utility's transition or stranded costs as determined by the Public Utility Commission.

Transmission
Interconnection electric lines which move high voltage electricity from where it is produced to the point of distribution to customers.

Transmission Charges
Part of the basic service charges on every customer's bill for transporting electricity from the source of supply to the electric distribution company. The Public Utility Commission regulates retail transmission prices and services. This charge will vary with your source of supply.

Unbundling
Breaking down services into parts so each part can be separately billed.

Wheeling
The transmission by one utility system of power that has been generated by another utility system.

As new terms are needed, WEC will add them to this Glossary.