Energy jargon, explained
Knowledge is Power.
The energy industry runs on jargon. Behind most of it is a real charge on your bill. Here’s what each term means, in plain English, and what it means for you.
Glossary
Buying power
What are day/night unit rates?
Two prices for the same electricity: one for daytime use and a cheaper one overnight, recorded by a meter with separate registers. Evening and weekend variations exist too.
Why it matters: If a good share of your use runs overnight, a day/night rate can cut your bill. If it doesn’t, a single rate is usually simpler and cheaper.
What are day/night unit rates?
Two prices for the same electricity: one for daytime use and a cheaper one overnight, recorded by a meter with separate registers. Evening and weekend variations exist too.
Why it matters: If a good share of your use runs overnight, a day/night rate can cut your bill. If it doesn’t, a single rate is usually simpler and cheaper.
What is a corporate power purchase agreement?
A power purchase agreement signed by a business rather than an energy supplier, usually to fix long-term costs and support new wind or solar projects.
Why it matters: Corporate PPAs have mostly been reserved for the biggest energy users. The contracts are long and complex, so most businesses never see one.
What is a corporate power purchase agreement?
A power purchase agreement signed by a business rather than an energy supplier, usually to fix long-term costs and support new wind or solar projects.
Why it matters: Corporate PPAs have mostly been reserved for the biggest energy users. The contracts are long and complex, so most businesses never see one.
What is a deemed energy contract?
The default contract you’re placed on when you use energy at a site without agreeing terms, usually after moving in.
Why it matters: Deemed rates are among the most expensive a supplier charges. If you’re on one, agreeing a proper contract is the quickest saving available to you.
What is a deemed energy contract?
The default contract you’re placed on when you use energy at a site without agreeing terms, usually after moving in.
Why it matters: Deemed rates are among the most expensive a supplier charges. If you’re on one, agreeing a proper contract is the quickest saving available to you.
What is a pass through energy contract?
A contract where you fix the wholesale price but pay network charges and levies at cost, as they’re billed.
Why it matters: Your unit rate looks lower and you avoid a supplier’s risk premium, but around a third of your bill will move with those charges rather than being fixed.
What is a pass through energy contract?
A contract where you fix the wholesale price but pay network charges and levies at cost, as they’re billed.
Why it matters: Your unit rate looks lower and you avoid a supplier’s risk premium, but around a third of your bill will move with those charges rather than being fixed.
What is a power purchase agreement (PPA)?
A contract to buy electricity from a specific generator at an agreed price, usually over several years.
Why it matters: your price is set by the contract, not the daily market, and you know exactly which generator you’re buying from.
What is a power purchase agreement (PPA)?
A contract to buy electricity from a specific generator at an agreed price, usually over several years.
Why it matters: your price is set by the contract, not the daily market, and you know exactly which generator you’re buying from.
What is a standing charge?
A fixed daily amount you pay however much energy you use. It covers the cost of keeping your site connected: metering, network maintenance and industry fees.
Why it matters: It’s the part of your bill you can’t reduce by using less, so compare it alongside the unit rate when you compare contracts.
What is a standing charge?
A fixed daily amount you pay however much energy you use. It covers the cost of keeping your site connected: metering, network maintenance and industry fees.
Why it matters: It’s the part of your bill you can’t reduce by using less, so compare it alongside the unit rate when you compare contracts.
What is a virtual power purchase agreement?
A financial version of a PPA. No electricity is supplied under the contract; the business and the generator settle the difference between the agreed price and the market price.
Why it matters: It hedges your cost and supports a named project without changing who supplies your sites.
What is a virtual power purchase agreement?
A financial version of a PPA. No electricity is supplied under the contract; the business and the generator settle the difference between the agreed price and the market price.
Why it matters: It hedges your cost and supports a named project without changing who supplies your sites.
What is PPA energy?
Electricity bought under a power purchase agreement. The term covers the whole family: physical PPAs, corporate PPAs and virtual PPAs.
Why it matters: However it’s structured, PPA energy means a known generator and a known price, which is more than most supply contracts can say.
What is PPA energy?
Electricity bought under a power purchase agreement. The term covers the whole family: physical PPAs, corporate PPAs and virtual PPAs.
Why it matters: However it’s structured, PPA energy means a known generator and a known price, which is more than most supply contracts can say.
What is the wholesale electricity price?
The price of electricity on the open market, before it reaches your bill. It moves every half hour with supply and demand.
Why it matters: Wholesale power is usually less than half of what you pay. The rest is made up of network charges, levies and supplier margin.
What is the wholesale electricity price?
The price of electricity on the open market, before it reaches your bill. It moves every half hour with supply and demand.
Why it matters: Wholesale power is usually less than half of what you pay. The rest is made up of network charges, levies and supplier margin.
Taxes and levies
What are the climate change levy rates?
The per-kWh rates set by government, updated each April. From 1 April 2026, electricity and gas are both charged at 0.801p per kWh.
Why it matters
What are the climate change levy rates?
The per-kWh rates set by government, updated each April. From 1 April 2026, electricity and gas are both charged at 0.801p per kWh.
Why it matters
What is the climate change levy (CCL)?
A government tax on business energy, charged per kWh and collected through your bill. It exists to push businesses towards using less.
Why it matters
What is the climate change levy (CCL)?
A government tax on business energy, charged per kWh and collected through your bill. It exists to push businesses towards using less.
Why it matters
Who qualifies for a CCL exemption?
Not every business pays the full levy. Domestic-scale users, charities with non-business use, and energy-intensive businesses with a climate change agreement pay a reduced rate or none at all. The agreement discount on electricity is 92%.
Why it matters
Who qualifies for a CCL exemption?
Not every business pays the full levy. Domestic-scale users, charities with non-business use, and energy-intensive businesses with a climate change agreement pay a reduced rate or none at all. The agreement discount on electricity is 92%.
Why it matters
Network and system charges
What is a DUoS charge (distribution use of system)?
What you pay your regional network operator to run the local wires that carry electricity to your site. Rates vary by region and by time of day.
Why it matters
What is a DUoS charge (distribution use of system)?
What you pay your regional network operator to run the local wires that carry electricity to your site. Rates vary by region and by time of day.
Why it matters
What is a TNUoS charge (transmission network use of system)?
What you pay towards the national high-voltage grid: the pylons and cables that move power around the country. For most businesses it’s a fixed daily amount based on the size of your connection.
Why it matters
What is a TNUoS charge (transmission network use of system)?
What you pay towards the national high-voltage grid: the pylons and cables that move power around the country. For most businesses it’s a fixed daily amount based on the size of your connection.
Why it matters
What is balancing services use of system (BSUoS)?
What you pay towards keeping the grid stable: the actions the system operator takes every day to match supply and demand. It’s charged as a fixed rate per unit you use.
Why it matters
What is balancing services use of system (BSUoS)?
What you pay towards keeping the grid stable: the actions the system operator takes every day to match supply and demand. It’s charged as a fixed rate per unit you use.
Why it matters
What is exempt supply (P442)?
An industry change (BSC modification P442) that allows eligible supply arrangements to be treated as exempt from certain industry charges, reducing the non-power costs on a bill.
Why it matters
What is exempt supply (P442)?
An industry change (BSC modification P442) that allows eligible supply arrangements to be treated as exempt from certain industry charges, reducing the non-power costs on a bill.
Why it matters
What is reactive power?
Power drawn from the network but not converted into useful work, common with motors, pumps and older equipment. It’s measured separately and can appear on bills as its own charge.
Why it matters
What is reactive power?
Power drawn from the network but not converted into useful work, common with motors, pumps and older equipment. It’s measured separately and can appear on bills as its own charge.
Why it matters
What is the balancing mechanism?
The tool the system operator uses to match supply and demand in real time. Generators and large users offer to turn up or down, and the operator picks the cheapest options, every half hour.
Why it matters
What is the balancing mechanism?
The tool the system operator uses to match supply and demand in real time. Generators and large users offer to turn up or down, and the operator picks the cheapest options, every half hour.
Why it matters
What is the capacity market charge?
A charge that pays generators to be available when the grid is tightest, mostly on winter evenings. It’s the cost of keeping the lights on at peak.
Why it matters
What is the capacity market charge?
A charge that pays generators to be available when the grid is tightest, mostly on winter evenings. It’s the cost of keeping the lights on at peak.
Why it matters
Metering and data
What are meter charges?
What you pay for the meter itself: a standard charge for operating and maintaining it, and one-off fees when an engineer has to visit your site.
Why it matters
What are meter charges?
What you pay for the meter itself: a standard charge for operating and maintaining it, and one-off fees when an engineer has to visit your site.
Why it matters
What is a half hourly meter (half hourly metering)?
A meter that records your usage every 30 minutes and sends the readings automatically. Half hourly metering is now standard for larger business sites.
Why it matters
What is a half hourly meter (half hourly metering)?
A meter that records your usage every 30 minutes and sends the readings automatically. Half hourly metering is now standard for larger business sites.
Why it matters
What is an AMR meter?
Automated meter reading. An AMR meter sends readings remotely, usually daily or monthly, so nobody has to visit your site.
Why it matters
What is an AMR meter?
Automated meter reading. An AMR meter sends readings remotely, usually daily or monthly, so nobody has to visit your site.
Why it matters
Certificates and emissions
What are scope 2 emissions?
The emissions from the electricity, heat and steam your business buys. Scope 1 is what you burn; scope 2 is what you purchase.
Why it matters
What are scope 2 emissions?
The emissions from the electricity, heat and steam your business buys. Scope 1 is what you burn; scope 2 is what you purchase.
Why it matters
What is a REGO certificate?
A Renewable Energy Guarantee of Origin: one certificate issued for each megawatt hour of renewable electricity generated in the UK. Suppliers use them to label tariffs renewable.
Why it matters
What is a REGO certificate?
A Renewable Energy Guarantee of Origin: one certificate issued for each megawatt hour of renewable electricity generated in the UK. Suppliers use them to label tariffs renewable.
Why it matters
What is a renewable energy certificate?
The general term for certificates that prove a unit of electricity was generated renewably. The UK version is the REGO; the US equivalent is the REC.
Why it matters
What is a renewable energy certificate?
The general term for certificates that prove a unit of electricity was generated renewably. The UK version is the REGO; the US equivalent is the REC.
Why it matters
What is an energy attribute certificate?
The umbrella term for all certificates of this kind: REGOs in the UK, RECs in North America, Guarantees of Origin in Europe.
Why it matters
What is an energy attribute certificate?
The umbrella term for all certificates of this kind: REGOs in the UK, RECs in North America, Guarantees of Origin in Europe.
Why it matters
What is the renewables obligation?
A closed government scheme that required suppliers to source a share of their power renewably, funded through bills. It closed to new generation in 2017, but payments run until 2037.
Why it matters
What is the renewables obligation?
A closed government scheme that required suppliers to source a share of their power renewably, funded through bills. It closed to new generation in 2017, but payments run until 2037.
Why it matters
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