Glossary

Biomass is any organic matter that can be used as a fuel to generate energy. Wood and waste wood are common examples of biomass fuel, but biomass also includes such matter as municipal solid waste, agricultural waste, lawn and yard waste, and animal waste--all of which can be converted to energy-producing fuels using available technologies.

British Thermal Unit (BTU) is a measurement of energy. BTU is commonly used to measure the energy content of various fuels and steam. One BTU is the amount of heat required to raise the temperature of one pound of water one degree Fahrenheit.Clean Air Act Amendments of 1990 represent a major overhaul of the earlier

Clean Air Act of 1970. Changes include revised provisions for attainment and maintenance of National Ambient Air Quality Standards, mobile sources, hazardous air pollutants, and other assorted air quality issues. In addition, it establishes guidelines for reductions in air pollution. The Act also specifically limits sulfur dioxide and nitrogen oxide emissions of power plants.

Cogeneration is the simultaneous production of two or more forms of useable energy from the combustion of a single fuel source. Because cogeneration uses the waste energy, which is vented in a traditional power plant, the process is 50 to 70 percent more efficient. Most cogeneration systems are designed to simultaneously produce electric power (to be used on site or sold back to an investor-owned utility or both) and thermal heat for industrial processes or the heating and cooling of buildings. Cogeneration projects can be any size, from 10 kilowatts to 1,000 megawatts or more.

Combined Cycle generation is a high-efficiency power production process. In a typical combined cycle power plant, combustion turbines (essentially large jet engines) burn natural gas or oil to generate electricity in the first cycle. In the second cycle, the exhaust heat is captured, rather than vented into the atmosphere, and is used to generate steam, which drives steam turbines to supply additional electric power. By using heat that otherwise would have been wasted to generate additional power, the combined cycle unit can produce cost savings as well as increased operating efficiency. Furthermore, this greater efficiency means more power is produced per unit of fuel, resulting in lower overall plant emissions.

Competitive Opportunities Proceeding Order, an historic ruling, was issued by the New York State Public Service Commission on May 20, 1996, which calls for effective deregulation of the state's electric power industry. The order calls for increased competition in New York's electric industry with the goal of having a competitive wholesale power market in early 1997 as a transition to a competitive retail market for electric customers in early 1998. This retail model is designed to stimulate economic growth, provide lower prices and give consumers more choices.

Demand Side Management (DSM) refers to utility programs intended to affect the timing or amount of customer electricity use. These include energy efficiency programs aimed at reducing the energy required to serve customer needs and programs that shift electricity demand to reduce peak loads or to make more economic use of utility resources.

The New York Department of Environmental Conservation (DEC) administers New York environmental policies, enforces environmental laws and regulations, performs research, and provides information of environmental subjects. The state agency also serves as the chief advisor to the Governor on state environmental policy and issues.

Dispatchability is the ability of a generating unit to increase or decrease generation, or to be brought on line or shut down at the request of a utility's system operator.

The U.S. Department of Energy (DOE) manages programs of research, development and commercialization for various energy technologies, and associated environmental, regulatory and defense programs. DOE announces energy policies and acts as a principal advisor to the President on energy matters.

Electric Capacity is the ability of a power plant to produce a given output of electric energy at an instant in time, measured in kilowatts or megawatts (1,000 kilowatts).

An Electric Utility is a company that controls the distribution of electricity in a specific state, area or region. Utilities often own and operate electricity generation and transmission facilities.

An Electric Utility Affiliate is a subsidiary or affiliate of an electric utility. Many utilities form affiliates to develop, own and operate independent power facilities.

Energy, broadly defined, is the capability of doing work. In the electric power industry, energy is more narrowly defined as electricity supplied over time, expressed in kilowatt-hours.

Energy Policy Act of 1992 (EPAct) is the first comprehensive federal energy law promulgated in more than a decade. The act will help create a more competitive U.S. electric power marketplace by removing barriers to competition resulting from the Public Utility Holding Company Act of 1935. By doing so, EPAct allows a broad spectrum of independent energy producers to compete in wholesale electric power markets.

The act also made significant changes in the way power transmission grids are regulated. Specifically, the law gives the Federal Energy Regulatory Commission (FERC) the authority to order electric utilities to provide access to their transmission facilities to other power suppliers.

Energy Services Companies (ESCOs) would be created in a de-regulated, openly competitive electric marketplace. The Energy Services industry would be made up of power aggregators, power marketers and brokers, whose job is to match buyers and sellers, tailor both physical and financial instruments to suit the needs of particular customers, and to allow even the smallest residential customers to form buying groups or cooperatives that will give them the same bargaining power as large industrial customers.

The U.S. Environmental Protection Agency (EPA) administers federal environmental policies, enforces environmental laws and regulations, performs research, and provides information on environmental subjects. The agency also acts as chief advisor to the President on U.S. environmental policy and issues.

An Exempt Wholesale Generator (EWG) is a category of power producer defined by the Energy Policy Act of 1992. EWGs are independent power facilities that generate electricity for sale in wholesale power markets at market-based rates. The Federal Energy Regulatory Commission (FERC) is responsible for determining EWG status.

The Federal Energy Regulatory Commission (FERC) is the chief energy regulatory body of the U.S. government. FERC was given new powers when Congress passed the Energy Policy Act of 1992. Under the Act, FERC is responsible for determining Exempt Wholesale Generator (EWG) status, and has the authority to order utilities to provide access to their power transmission systems to other electric generators.

In addition, FERC certifies Qualifying Facilities (QFs: another term for IPP) as defined by the Public Utility Regulatory Policies Act; establishes and enforces rates for power sales and transmission services; issues licenses for hydroelectric projects; and regulates aspects of mergers and acquisitions of gas and electric utility companies. The commission also establishes and enforces rates related to the sale and transportation of oil and natural gas.

A Gigawatt is a unit of electric power equal to one billion watts, or one thousand megawatts--enough power to supply the needs of a medium-sized city.

A Greenfield Plant is a new electric power generating facility built from the ground up.

The Grid is a network of high voltage transmission lines along which power moves. In the United States, there are three distinct electric power grids: the Eastern Interconnection, of which New York State is a part; the Texas Interconnection; and the Western Systems Coordinating Council. In addition, certain regions of the U.S. import electric power from the Canadian grid. Many New York utilities and the Power Authority import electricity generated in Canada.

The North American Electricity Reliability Council estimates that on the North American continent, the electric power transmission network consists of approximately 147,000 miles of lines operating at a minimum of 230 kilovolts. Electric utilities own more than 80 percent of the North American electric power transmission network.

Independent Power Producers (IPPs) are private entrepreneurs who develop, own or operate electric power plants fueled by diversified energy sources such as biomass, cogeneration, coal, small hydro, waste-to-energy and wind facilities.

Investor-Owned Utility (IOU) is a form of electric utility owned by a group of investors. Shares of IOUs are traded on public stock markets.

Independent System Operator (ISO) is the entity charged with reliable operation of the Grid and provision of open Transmission Access to all market participants on a non-discriminatory basis.

A Kilowatt (kW) is a measurement of electric power equal to one thousand watts. Electric power capacity of one kW is sufficient to power 10 100-watt light bulbs, or about one average home.

A Kilowatt Hour (kWh) is a measurement of energy and is equal to the energy produced by a one kilowatt plant in one hour. (Note: A typical electric consumer in New York State uses 500 kWh per month of electricity.)

A Megawatt (MW) is a unit of electric power equal to one million watts, or 1,000 kilowatts.

The North American Electricity Reliability Council (NERC) is formed by electric utilities to coordinate, promote and communicate about the reliability of their generation and transmission systems.

NERC is comprised of nine regional councils and one affiliate that together encompass most of the electric utility systems in the U.S., Canada and the northern portion of Baja California, Mexico. NERC reviews the overall reliability of existing and planned generation systems, sets reliability standards, and gathers data on demand, availability and performance.

A Power Purchase Agreement is the contract entered into by an independent power producer and an electric utility. The power purchase agreement specifies the terms and conditions under which electric power will be generated and purchased. Power purchase agreements require the independent power producer to supply power at a specified price for the life of the agreement.

While power purchase agreements vary, their common elements include: specification of the size and operating parameters of the generating facility; milestones, in-service dates and contract terms; price mechanisms; service and performance obligations; dispatchability options; and conditions of termination or default.

Project Financing is the most commonly used method to finance the construction of independent power facilities. Typically, the developer pledges the value of the plant and part or all of its expected revenues as collateral to secure financing from private lenders.

The New York Public Service Commission (PSC) is New York State's regulatory body charged with regulating utilities. Members of the PSC regulate all electric, gas, water, cable, and telephone retail rates. The Commission also ensures that utilities are responsive to customers' needs and service requests, and that service is adequate and reliable. The Department of Public Service (DPS) includes the agency personnel reporting to the Commission.

Enacted in 1980, Public Service Law Section 66-c required New York's electric utilities to purchase electricity, upon terms and conditions the Public Service Commission found just and reasonable, from qualifying cogeneration, alternative energy production, and small hydro plants. (Note: PSL Section 66-c was amended in 1981 to provide for a minimum purchase price of six cents per kilowatt hour for any facility developed on or after June 26, 1980. On July 24, 1992 Governor Mario Cuomo signed legislation repealing the PSL Section 66-c six-cent minimum rate, but grandfathered existing contracts against the repeal.)

The Public Utility Holding Company Act of 1935 (PUHCA) was enacted by the U.S. Congress to regulate the large interstate holding companies that monopolized the electric utility industry during the early 20th century.

The Public Utility Regulatory Policies Act of 1978 (PURPA), among other things, promotes energy efficiency and increased use of alternative energy sources by encouraging companies to build cogeneration facilities and renewable energy projects using wind power, solar energy, geothermal energy, hydropower, biomass, and waste fuels.

Facilities meeting PURPA's requirements are called Qualifying Facilities (QFs). PURPA encourages their construction by requiring utilities to purchase a QF's electric output at a price no greater than the cost the utility would have incurred had it supplied the power itself or obtained from another source (See Qualifying Facility and Avoided Costs).

A Qualifying Facility is a category of power generating facility defined by the Public Utility Regulatory Policies Act (PURPA). PURPA created two types of QFs, Qualifying Small Power Producers and Qualifying Cogeneration Facilities.

A Ratepayer is a retail consumer of the electricity distributed by an electric utility. This includes residential, commercial and industrial users of electricity.

Renewable Energy Credits are purchased by New York State utilities to invest in new renewable generation resources to serve their retail customers as part of the Clean Energy Standard.

Renewable Resources are any sources of energy that is constantly replenished, as through natural processes. Sunlight, moving water, geothermal springs, biomass (including wood and municipal solid waste) and wind are examples of renewable energy resources used to generate electricity.

A Repowered Plant is an existing power facility that has been substantially rebuilt to extend its useful life.

Small Power Producers use renewable energy sources-wind, solar, geothermal, hydropower, biomass-or waste fuels. PURPA specified a size limit of 80 MW on Small QFs, but this limit was waived by Congress in 1990 for all facilities, except hydropower plants, that request QF status by December 31, 1994.

The second type of QF, a Qualifying Cogeneration Facility, must produce both useful steam and electricity, and must meet PURPA-specified efficiency standards if it is fueled by oil or natural gas.

To encourage new players and stimulate innovation, PURPA also specified that a Qualifying Facility cannot be more than 50 percent owned or controlled by an electric utility or an electric utility holding company. Power producers that meet the QF requirements of PURPA are exempt from many federal and state regulations governing electric utilities. For instance, QFs are generally free from rate regulation and oversight of financing instruments. However, that is not to say that QFs are unregulated. The same environmental regulations apply to both QFs and utility plants. (See IPP.)

Stranded/Strandable Costs are those costs inherent in the existing electric utility industry rendered potentially unrecoverable in a competitive market.

Systems Benefits Charge is a per-customer charge intended to recover the costs of utility demand-side management, research and development.

 

A Service Territory is the state, area or region served exclusively by a single electric utility.

Small Hydro is a type of generating system that converts the mechanical energy of running water into electric energy much the same as any larger traditional hydroelectric system. Small is defined in state and federal law to be less than 80 megawatts.

Transmission is the process by which electric power is moved along high voltage power lines.

Waste-to-Energy is a technology that uses refuse to generate electricity. In mass burn plants, untreated waste is burned to produce steam, which is used to drive a steam turbine generator. In refuse-derived fuel (RDF) plants, refuse is pre-treated, partially to enhance its energy content prior to burning.

Wheeling is an industry term for the transmission or movement of power over transmission lines. Electric power can be wheeled from a generating plant directly to a wholesale or retail consumer, or it can be wheeled to the consumer through the interconnected transmission facilities of one or more intermediate utilities.

Wind power is a renewable energy source used to generate electricity by converting wind energy into useful mechanical energy. This mechanical energy is then converted into electricity by the use of an electric generator located within each individual wind machine.

Zero-Emissions Credits are purchased by New York State utilities for the generation by a nuclear electric generating facility as part of the Clean Energy Standard.