Deregulation terms you need to know
| Investor Owned Utility (IOU) -is a regulated utility owned by investors and/or shareholders. Federal Energy Regulatory Agency (FERC) - is the agency that regulates interstate electricity transactions. Generation - is the process by which fuels (gas, coal, nuclear fuel, etc) or renewable sources of energy (hydraulic energy or solar energy) are converted into electric energy. Transmission - is the process by which generated electricity is moved in bulk from the generation plant to the wholesale purchaser. Distribution - is the process of delivering power from the wholesale purchaser to the retail consumer. Wheeling - is when a utility transmits electricity across its lines on behalf of another utility. Wholesale Wheeling - is a means of effectively managing the generation and delivery of wholesale electricity as a commodity. Retail Wheeling - is the delivery of a generation utility's electricity across a distribution utility's lines to the end-use consumer. Cherry Picking - is when a generation utility comes into a distribution territory and approaches all the large industrial accounts with low bids for electricity in an attempt to eliminate competition. Stranded Costs - are costs incurred by a utility preparing for anticipated power needs that might not come about under competition. These are the costs that were undertaken to meet its prior obligation to serve any and all customers within its geographical service region which can be recovered. Direct Access - is the ability of an end user of electricity to contract with the supplier of choice for electrical services. Competition Transition Charge (CTC) - is a charge that allows for utility companies to recover stranded costs. Independent System Operator (ISO) - is an independent entity who oversees and schedules all transmission activities in California. Power Exchange (PX) - is an independent electricity price clearing house for sellers and buyers of power. Ancillary Services - are services necessary to insure reliable delivery of power. This includes reserves and reactive power supply. Marketer - is an entity which buys and sells electric energy, transmission, and other services from traditional utilities and other suppliers, and then resells those services at wholesale or to an end-use customer. Broker - is a person or company that arranges the sale and purchase of electric energy, transmission, and other services between buyers and sellers. A broker does not take title to the power, as does a marketer. Aggregator - is a person or company that specializes in forming buying groups to enable small to medium sized customers to be able to take advantage of bulk power sales. |