Business energy jargon explained
Do you find the industry jargon on energy bills and contracts frustrating? This guide to jargon and abbreviations can help you to make sense of it all.
It’s no secret that managing a business’s energy contracts and bills can be difficult at times. Many business owners may struggle to understand the terms and details of their gas and electricity contracts, as well as the industry jargon surrounding it all. Unfortunately, this lack of understanding when it comes to managing energy accounts means that many business owners are unwittingly paying too much for their company’s gas and electricity.
In order for business owners to take control of their energy bills, and become proactive in always ensuring they’re getting the best deal, it can help to gain a better understanding of words and terms used in the business energy world.
Agreed Read Dispute (ARD)
An industry-wide process to resolve problems arising when closing and opening meter readings do not correspond during a switch or change of tenancy.
Agreed supply capacity
The amount of energy that the District Network Operator (DNO) makes available to a business’s premises; the maximum amount of energy that can be drawn at one time. Also called ‘available supply capacity’.
Air source heat pump (ASHP)
A system which transfers heat in the air outside into a building in order to warm it. Can also be used to cool a building and heat water.
A report received from energy suppliers once a year detailing information about consumption and costs.
Annual Quantity or Annual Agreed Quantity (AQ or AAQ)
An estimate of future consumption of commercial gas, as calculated by the distribution network, Transco.
Authorised Supply Capacity (ASC)
This only applies to Maximum Demand customers and is the commercial electricity 'load' allowed to be taken to run industrial equipment.
Automated Meter Reading (AMR)
Available from Smart Meters, these readings provide instant and accurate data about commercial electricity consumption.
Back-dated charges from a supplier, covering a period in which a customer was mistakenly not billed for energy.
The six largest energy companies in the market: British Gas, E.ON, EDF Energy, npower, Scottish Power and SSE.
Blend & Extend
A type of tariff which allows businesses currently tied into a fixed energy deal to extend their contract in order to make the most of lower rates.
Calorific Value (CV)
A measurement of the energy contained in gas and usually quoted in megajoules per cubic metre (MJ/m3).
Climate change agreement
An agreement made by a business to reduce energy usage and carbon emissions in exchange for a lower rate of Climate Change Levy.
A charge introduced by the Government in 2001 on commercial electricity and gas, intended to encourage less consumption and reduce emissions of greenhouse gases.
Carbon Dioxide (CO2)
A greenhouse gas, measured in tonnes, that makes up the Carbon Footprint belonging to each commercial electricity user.
Carbon Reduction Commitment (CRC)
A scheme designed to improve energy efficiency in large organisations and mandatory for the 5,000 biggest commercial electricity users in the UK.
Unit of measurement used in carbon footprints, expressing the amount of carbon dioxide that is released into the atmosphere.
The impact that a business or individual’s actions has on the environment. Usually measured in units of carbon dioxide equivalent.
Carbon reduction commitment (CRC)
A government scheme mandatory to non-energy intensive businesses, with the purpose of reducing the UK’s carbon emissions.
An agreement between a business and an energy company for the supply of gas and/or electricity to the business’s premises.
Deemed rates / Deemed contract
Higher-than-average energy rates, typically seen when a business moves into new premises.
Department of Energy and Climate Change (DECC)
Created by the Government in 2008 to 'ensure our energy is secure, affordable and efficient'.
Company that distributes energy to consumers in the UK. Also called district network operators.
Distribution use of system (DUoS)
Charge paid to distribution network operators for the
Electricity Central Online Enquiry Service (ECOES)
A service provided by the electricity suppliers and distribution companies which notifies the relevant organisations when someone is switching commercial electricity supplier.
See contract end date.
Estimated Annual Consumption (EAC)
Similar to AQ but for profiling the consumption of commercial electricity, based on historic billing information. Sometimes known as Calculated Annual Consumption or CAC.
Used by a supplier to charge for energy consumption when no actual reading has been provided.
European Union Emissions Trading Scheme (EU ETS)
A scheme to reduce emissions of carbon dioxide to meet targets set out in the Kyoto Protocol.
A type of energy contract that provides you with a fixed energy rate over a specified period of time.
Fossil fuel levy (FFL)
A charge split between suppliers and consumers for using energy created from non-renewable sources.
Gigawatt hour (gWh)
A watt is used to measure a unit of energy. In this case a Gigawatt is a million units.
Ground source heat pump (GSHP)
A method of extracting heat from the ground – using pipes – in order to heat radiators etc.
The name for meters with the profile number '00' that are used by energy-intensive businesses whose average peak electricity demand was greater than 100kW in any three months of the previous year.
Half hourly supply – sometimes called 100kW supply
Reserved for high use energy customers (customers who consume for the 100kVA)
An industrial energy refers to the needs of high consuming businesses, such as manufacturers.
An international standard unit used to measure energy.
A unit of power required to run industrial machinery.
A Kilowatt hour is a unit of energy consumed over one hour. A kWh is 3.6 megajoules (joules).
An industry terms that refers to customers who consume more than 100 kWh.
This refers to the maximum daily consumption that is allowed by any one supply point.
Levy Exemption Certificate (LEC)
Issued by Ofgem to exempt the holder from paying Climate Change Levy in addition to business electricity charges.
Liquefied Natural Gas (LNG)
Gas cooled so that it condenses into a liquid and can be more easily transported and stored.
Megawatt hour (mWh)
A unit of energy that is equal to 1000 kWh.
Maximum Demand (MD)
The highest expected load drawn from the network by an intensive commercial electricity user. Maximum Demand meter profile numbers begin with '05, 06 07, 08' and usually have their own types of tariff. See also: Large site peak day demand
Meter Point Administration Number (MPAN)
Also known as a 'supplier number' or an 'S number', this is the unique identifying number that can be found on a business electricity price bill. The first two digits give your meter profile (03 or 04 for small businesses, 05 to 08 for maximum demand and 00 for half-hourly.
Meter Point Reference (MPR)
The unique identifying number of a commercial gas supply. It is 10 digits and can be found on a bill.
A unique number used to identify a meter which will be displayed on the front of most meters - sometimes known as a meter reference number (MRN).
Refers to customers – typically non-domestic – which have energy supplied and billed to multiple premises by one supplier.
Notice period end date
The period given at the end of a business energy contract when the customer must arrange a new deal to avoid being rolled onto expensive deemed rates.
Energy that comes from a non-renewable source, such as coal, or natural gas.
Office of Gas and Electricity Markets (OFGEM)
The organisation set up to regulate and promote competition within the deregulated energy industry.
Rates that a business energy customer assumes if they fail to organise a new contract within their renewal window.
A notification, usually a letter that is required to be sent to each customer by a supplier when they are increasing their prices.
HM Revenue & Customs form to claim exemption or discount from the Climate Change Levy (CCL).
Renewal notification letter
Renewable obligation certificate (ROC)
Holds details of exactly how a unit of renewable electricity was produced, who produced it and who bought the electricity.
Also known as evergreen and assumptive renewal. See also: out of contract rates. Another term given to the rates that are given to customers who are no longer covered by a formally agreed energy contract.
New meter technology that automatically communicates with your supplier to provide more accurate consumption data, and therefore billing.
Renewable energy technology that converts light into energy.
A compulsory charge included in your energy contract that covers maintenance of the national grid and the lines leading to your property.
The company who supplies you with gas or electricity. Business energy customers can have two separate suppliers, one for each individual fuel they use.
Switching window – renewal window
See renewal window.
A domestic energy term used to describe pre-defined energy packages available to households.
Third party intermediary (TPI)
A term which refers to third parties operating within the energy market, such as energy brokers and price comparison websites.
Transmission Network Use of System Charges (TNUoS)
These are a set of supplier charges to help them recover the cost of installing and maintaining the transmission system in the UK.
This is the price that your pay per unit of energy used. It is defined by the stipulations of your energy contract.
Value Added Tax (VAT)
A government tax levied by the government on certain goods – including energy.
A type of contract that allows your unit rateto fluctuate in line with the wholesale cost of energy.
The use of turbine technology, designed to turn wind into renewable energy.