• Price

    The amount of money or consideration-in-kind for which a service is bought, sold, or offered for sale.

  • Price Cap

    A method of setting a utility distribution company's rates whereby a maximum allowable price level is established by regulators, flexibility in individual pricing is allowed, and where efficiency gains can be encouraged and captured by the company.

  • Price Majeure

    The process of retrading interruptible gas which is the result of significant upward or downward price adjustments.

  • Price To Earnings Ration (P/E Ratio)

    Ratio is calculated by dividing the price per share of common stock by earnings per share over the most recent 12 months. Measured monthly at the enterprise level, it shows the amount investors are willing to pay for $1 of an enterprise's current earnings.

  • Pricing Differential

    The difference between a pipeline's actual gas supply contract costs and a surrogate, such as an index price, for a deemed market price.

  • Primary Market

    Primary markets are the markets where new securities are bought and sold. They act as the conduit through which new capital or funds are acquired.

  • Primary Recovery

    The recovery of oil and/or natural gas by any method (natural flow or artificial lift) that may be employed to produce them through a single well bore; the fluid enters the well bore by the action of native reservoir energy or gravity.

  • Prime Mover

    The engine, turbine, water wheel or similar machine that drives an electric generator; or, for reporting purposes, a device that converts energy to electricity directly (e.g., photovoltaic solar and fuel cells).

  • Processing Plant

    A facility in which raw natural gas from the wellhead is made to meet pipeline quality specifications and prepared for sale to consumers by reducing or removing undesirable impurities and extracting commercially desirable non-methane hydrocarbons from the gas stream.

  • Producer

    A working interest owner of an oil and/or gas well. A producer may sell its share of production itself through the operator of the well, or through another producer.

  • Producer Demand Charge

    Fixed charge paid by customers to producers in order to guarantee the availability of supplies.

  • Profit

    The income remaining after all business expenses are paid.

  • Project-Financed Pipeline

    A pipeline funded by pledging expected revenues to cover the debt.

  • Propane (C3H8)

    A hydrocarbon substance consisting of molecules composed of three carbon atoms and eight hydrogen atoms, used primarily in residential and commercial heating and cooling, and as transportation fuel and petrochemical feedstock.

  • Propylene (C3H6)

    A hydrocarbon substance consisting of molecules composed of three carbon atoms and six hydrogen atoms, used primarily in residential and commercial heating and cooling, and as a transportation fuel and petrochemical feedstock.

  • Proration

    A methodology to allocate a commodity such as pipeline capacity or natural gas supply under which the commodity is split among those seeking to obtain it based on a factor, such as quantity requested or numbers of individuals (per capita).

  • Provider of Last Resort

    A legal obligation (traditionally given to utilities) to provide service to a customer where competitors have decided they do not want that customer's business.

  • Pseudo-Tie

    A calculated reading or value which is updated in real time and which is used as a tie line flow in the ACE equation but for which no physical energy metering actually exists. The integrated value is used as a metered MWh value for interchange accounting purposes.

  • Public Authority Service to Public Authorities

    Public authority service includes electricity supplied and services rendered to municipalities or divisions or agencies of State or Federal governments, under special contracts or agreements or service classifications applicable only to public authorities.

  • Public Street and Highway Lighting

    Public street and highway lighting includes electricity supplied and services rendered for the purposes of lighting streets, highways, parks, and other public places; or for traffic or other signal system service, for municipalities, or other divisions or agencies of State or Federal governments.

  • Public Utility Holding Company Act (PUHCA or 35 Act)

    A law enacted in 1935 to control the corporate monopoly abuses and misconduct arising from utility market power and insufficient regulatory resources to mitigate it. PUHCA defines allowable structures by which utilities may organize and vests regulatory authority over various financial and corporate matters with the Securities and Exchange Commission (SEC). The National Energy Policy Act of 1992 amended several sections of PUHCA, enabling electric utilities to compete in the independent power market without becoming subject to its terms.

  • Public Utility Regulatory Policies Act of 1978 (PURPA)

    Federal law that requires utilities to purchase electricity from qualified independent power producers at a price that reflects what costs the utilities avoid by buying power from the QF rather than procuring the capacity and energy by another means (See avoided cost.) Portions of the act were designed to encourage the development of small-scale cogeneration and renewable resources.

  • Pumped-Storage Hydroelectric Plant

    A plant that generates electric energy by using water pumped during off-peak periods into an elevated storage reservoir. At peak periods, when additional generating capacity is needed, the water is released from the elevated storage reservoir to turbine generators in a power plant at a lower elevation. A hydroelectric power plant that uses both pumped water and natural stream flow to produce electricity is a Combined Pumped-Storage Hydroelectric Plant.

  • Pumping Hours

    The total number of hours a turbine/generator unit was operated as a pump/motor set (for hydro and pumped storage units only).

  • Purchased Power Adjustment

    A clause in a rate schedule that provides for adjustments to the bill when energy from another electric system is acquired and it varies from a specified unit base amount.

  • Pure Pumped-Storage Hydroelectric Plant

    A plant that produces power only from water that has previously been pumped to an upper reservoir.


    Public Utility Regulatory Policies Act of 1978.

  • Put Option

    The right but not the obligation to sell the underlying assets at an agreed upon price (strike or exercise price) on or before the expiration date. The person who buys a put option expects prices to fall. If the price does not fall, the purchaser loses the price of the put but does not have to exercise, or use it.

  • Qualifying Facilities (QFs)

    A designation ,created by the Public Utility Regulatory Policies Act of 1978 (PURPA), for non-utility power producers that meet certain operating, efficiency and fuel use standards set by the Federal Energy Regulatory Commission. To receive status as a qualifying facility (OF) under PURPA, the facility must produce electric energy and "another form of useful thermal energy through the sequential use of energy," and meet certain ownership, operating, and efficiency criteria established by the Federal Energy Regulatory Commission (FERC). (See the Code of Federal Regulations, Title 18. Part 292.) OFs may rely on renewable energy sources or cogeneration.

  • Radial

    A transmission or distribution system that is not networked and does not provide multiple parallel flow paths.

  • Railroad and Railway Services

    Railroad and railway services include electricity supplied and services rendered to railroads and interurban and street railways, for general railroad use, including the propulsion of cars or locomotives, where such electricity is supplied under separate and distinct rate schedules.

  • Ratchet or Ratcheted Demand Charge

    The Demand Charge level that a customer pays each month regardless of actual consumption. The demand charge is based on the peak consumption rate during a rolling period of time (usually 12 months.)

  • Rate

    The unit charge or charges made by an energy company or utility to customers for energy. Rate structures include:

  • Rate Base

    The value of property upon which a utility is given the opportunity to earn a specified rate of return as established by a regulatory authority. The rate base generally represents the value of property used by the utility in providing service and may be calculated by anyone or a combination of the following accounting methods: fair value, prudent investment, reproduction cost, or original cost. The rate base may include a working capital allowance covering such elements as cash, working capital, materials and supplies, prepayments, minimum bank balances and tax offsets. The rate base may be adjusted by deductions for accumulated provision for depreciation, contributions in aid of construction, accumulated deferred income taxes, and accumulated deferred investment tax credits.

  • Rate Design

    The development of electricity prices for various customer-classes to meet revenue requirements dictated by operating needs and costs within current regulatory and legislative policy goals.

  • Rate of Return

    The profit a regulated utility is given the opportunity to earn. The allowed rate of return is the percentage determined by the jurisdictional state or federal commission based on standards including the cost of capital in other sectors with comparable risk. The achieved rate of return is the actual result the utility obtained over any given period. In the utility industry, rate of return usually refers to the rate of return on rate base. (See Revenue Requirement.)

  • Rate Schedule

    The rates, charges and provisions under which service is supplied to a designated class of customers. Also referred to as a Service Classification.

  • Re-Regulating Reservoir

    A reservoir located downstream from a hydroelectric peaking plant which stores the widely fluctuating discharges from the upstream plant in order to release them downstream in a relatively uniform manner.

  • REA

    Rural Electrification Administration.

  • Reactive Power

    Reactive power is utilized to control voltage on the transmission network, particularly, the portion of the electrical power flow incapable of performing real work or energy transfer (See Real Power). Reactive power is that portion of electricity that establishes and sustains the electric and magnetic fields of alternating current equipment. It must be supplied to most types of magnetic equipment, such as motors and transformers. It also must supply the reactive losses on transmission facilities. Reactive power is provided by generators, synchronous condensers, or electrostatic equipment, such as capacitors, and directly influences electric system voltage. It is measured in megavars.

  • Reactive Power Generation

    The production of electric current that leads-or lags the phase of the electric voltage. Reactive power supplies the charging power for electromagnetic loads and the reactive needs of the transmission system.

  • Real Power

    The portion of the electrical power flow capable of performing real work or energy transfer. Real power is utilized to supply customer load on the transmission network and is expressed in megawatts.

  • Real Power Loss Service

    Compensates for losses measured in KWh incurred by the Host Control Area(s) as a result of the interchange transaction for a transmission customer.

  • Real Time Pricing

    Time of day pricing whereby the customer receives frequent signals on the cost of consuming electricity at that time.

  • Rebundling

    The process under Order No. 636 whereby an agent may act on behalf of a customer to arrange supply, storage and/or transportation service and sell these combined services to a customer.

  • Recall Rights

    The provision for a wholesale seller of power to cease to perform, generally in order to use such power to serve its indigenous retail loads.

  • Recallable Available Transmission Capability (RATC)

    Transmission Capability - Transmission Reliability Margin - Contracted Recallable Transmission Service - Non-Recallable Transmission Service = Recallable Available Transmission Capability

  • Receipt Point

    The point on a pipeline's system at which it receives natural gas into its system.

  • Receiving Control Area

    The control area within whose metered boundaries a schedule of capacity and/or energy is consumed. Absent other offsetting simultaneous interchange schedules, the Receiving Control Area will accept a net import schedule of capacity and/or energy, in lieu of, or in addition to, its own generation to meet Control Area load requirements.

  • Reciprocity

    Requires those that own, control or operate transmission facilities and request open-access service to, in turn, provide open access service to the transmitting utility.

  • Recoverable Gas Reserves

    The quantity of natural gas determined to be economically recoverable and available for delivery from a well or wells at a given price over a specific period of time.

  • Redelivery

    Delivery of natural gas by a pipeline, back to a shipper or to a shipper's account that the pipeline had received from the shipper.

  • Refill

    The annual process of filling a reservoir; also refers to the point at which the hydroelectric system is considered "full" from the seasonal snowmelt runoff.

  • Refined Helium


  • Reforming

    A chemical process that uses heat in presence of a catalyst to break down a substance into desired components; e.g., natural gas or light oils may be reformed into lower Btu fuel gas. Also used to describe the process of refining gasoline designed to burn with fewer emissions.

  • Refund Floor

    The most recent just and reasonable gas rate approved by the FERC, which is the lower limit that can be used for calculating refunds resulting from a subsequent rate case.

  • Regional Security Plan

    The plan that .explains how the Regional Council will meet the NERC Operating Policies that deal with operational security.

  • Regional Transmission Group

    A proposal advanced by the FERC to establish regional groups to expedite the coordination of wholesale wheeling. The group is voluntary in each region and may include transmission system owners, wholesale purchasers, and independent power generators.

  • Regulating Reserve

    The amount of spinning reserve responsive to automatic generation control, which is sufficient to provide normal regulating margin.

  • Regulation

    The governmental function of controlling or directing economic entities through the process of rulemaking and adjudication.

  • Regulation Service

    The process whereby one control area contracts to provide correct response to all or a portion of the ACE of another control area. The controlling utility assumes the obligation of meeting all applicable control criteria as specified by NERC.

  • Regulatory Out Clause

    A contractual provision whereby a party is excused from performance due to the actions of a jurisdictional regulatory agency.

  • Relative Strength Index

    A principal momentum indicator or price oscillator used with natural gas futures. RSI values fluctuate between 0 and 100, 70+ indicates an overbought market and 30 or less indicates an oversold market.

  • Releasing Shipper

    A shipper who is the original capacity holder of firm space on a pipeline for which reservation fees are paid, and who desires to sell this capacity under the capacity release program.

  • Reliability

    The degree to which the performance of the elements of a system results in power being delivered to consumers within accepted standards and in the amount desired. The degree of reliability may be measured by the frequency, duration, and magnitude of adverse effects on consumer service.

  • Remote Terminal Unit (RTU)

    A remotely controlled unit which gathers accumulated and instantaneous data to be telemetered to a specified control center which displays the current status of the generation facility. Inputs can be used for economic dispatch.

  • Removal Permit

    A permit for the removal (export) of gas from a given Canadian province issued by the appropriate government body.

  • Renewable Resource

    A power source that is continuously or cyclically renewed by nature, i.e., solar, wind, hydroelectric, geothermal, biomass or similar sources of energy.

  • Replacement Shipper

    A shipper who acquires firm transportation capacity after release by another shipper under the capacity release program. (Also known as "acquiring shipper.")

  • Repowering

    The partial or complete replacement of the existing steam supply system with a new (and usually technologically different) steam supply system. Most other systems and components, including the steam-turbine generator, are refurbished and reused. Repowering generally increases the output of the plant and reduces its heat rate, thus improving overall efficiency.

  • Repressuring

    Forcing natural gas or water, under pressure, into the oil reservoir in an attempt to increase the recovery of crude oil.

  • Requirements, Full

    A sale by a supplier to a purchaser in which the seller pledges to meet all of the purchaser's requirements, or the purchaser pledges to buy all of its requirements from the seller, or both.

  • Requirements, Partial

    A sale by a supplier to a purchaser in which the seller pledges to meet a part of the purchaser's energy requirements.

  • Rerating

    Change in a generator's capability as a result of changes in conditions such as age, auxiliary equipment, cooling, etc.

  • Reregulation

    The design and implementation of regulatory practices to be applied to the remaining regulated entities after restructuring of the vertically integrated electric utility. The remaining regulated entities would be those that continue to exhibit characteristics of a natural monopoly, where imperfections in the market prevent the realization of more competitive results, and where, in light of other policy considerations, competitive results are unsatisfactory in one or more respects. Reregulation could employ the same or different regulatory practices as those used before restructuring.

  • Reservation Fee

    A set unit charge payable at the outset by the recipient of a service based on total entitlement. Similar to an "option" charge or "demand" charge. Currently used by natural gas transmission pipelines for firm transportation service.

  • Reserve Capacity

    Capacity in excess of that required to-carry peak load, available to meet unanticipated demands for power or to generate 'Power in the event of loss of generation.

  • Reserve Margin (Operating)

    The amount of unused available -capability that can be applied to the system within 10 minutes at peakload for a utility system, expressed as a percentage of total capability.

  • Reserve Shutdown

    A state in which the unit was available for service but not electrically connected to the transmission system for economic reasons.

  • Reserves

    Natural gas in natural underground formation in wells, fields or pools.

  • Reserves to Production Ratio (RIP)

    An estimate used to project the productive life of a field based upon the size of the field compared to the annual production capacity.

  • Reservoir

    Man-made: A structure which stores water for later use in the production of electricity. Natural: A rock stratum that forms a trap in which oil and natural gas may accumulate.

  • Residential

    The residential sector is defined as private household establishments which consume energy primarily for space heating, water heating, air conditioning, lighting, refrigeration, cooking and clothes drying. The classification of an individual consumer's account, where the use is both residential and commercial, is based on principal use.

  • Residual Fuel Oil

    The topped crude of refinery operation after the removal of valuable distillates like gasoline; includes No.5 and No.6 fuel oils: Residual fuel oil is used for the production of electric power, space heating, vessel bunkering, and various industrial purposes. Imports of residual fuel oil include imported crude oil burned as fuel.

  • Resource Efficiency

    The use of smaller amounts of physical resources to produce the same product or service. Resource efficiency involves a concern for the use of all physical resources and materials used in the production and use cycle, not just the energy input.

  • Resting Order

    In futures trading, an order away from the market waiting to be executed.

  • Restoration Service

    Source of power which enables a host control area to restore its system and a transmission customer to start its generating units or restore service to its customers when local power is not available.

  • Restructuring

    The unbundling of pipeline transportation, storage, gathering and sales services and associated realignment of service obligations resulting from Order No. 636.

  • Retail

    Sales covering electrical energy supplied for residential, commercial, and industrial end-use purposes. Other small classes, such as agriculture and street lighting, also are included in this category.

  • Retail Competition

    A system under which more than one electric provider can sell to retail customers, and retail customers are allowed to buy from more than one provider. (See also Direct Access)

  • Retail Wheeling

    The sale of electricity by a utility or other supplier to a customer in another utility's retail service territory. Refers to the use of the local utility's transmission and distribution lines to deliver the power from a wholesale supplier to a retail customer by a third party.

  • Retroactive Ratemaking

    A practice prohibited under the Natural Gas Act which bars increasing gas rates on a retroactive basis.

  • Return on Capital Employed (RaCE)

    A measure of the effectiveness of a business in using its sources of capital to generate earnings. It is a measure of EBIT divided by capital employed. Capital employed represents the total debt and equity components of the balance sheet.

  • Return on Equity

    Compensation for the investment of capital; i.e., earnings. Regulated public utilities statutorily entitled to charge rates that permit them to earn a fair return on their equity invested.

  • Return on Invested Capital (ROIC)

    A fundamental measure of the earning power of a company. It is equal to earnings before interest and taxes times one minus the tax rate, all divided by total assets minus current liabilities.

  • Revenue

    The total amount of money received by a firm from sales of its products and/or services, gains from the sales or exchange of assets, interest and dividends earned on investments, and other increases in the owner's equity except those arising from capital adjustments.

  • Revenue Requirement

    The amount of funds (revenue) a utility must take in to cover the sum of its estimated operation and maintenance expenses, debt service, taxes, and allowed rate of return. Revenue requirement is often defined as:

  • Right of First Refusal

    Process which allows any long-term firm gas transportation customer, including formerly bundled city-gate sales customers, to continue receiving firm gas transportation service by paying up to the maximum rate and matching the length of a term offered by another customer who is seeking service.

  • Right-of-Way (ROW)

    A strip of land, the use of which is acquired for the construction and operation of a pipeline or some other facility; may be owned outright or an easement taken for a specific purpose.

  • RIN

    Real-time Information Network. Method proposed by the FERC to have information available via an Electronic Bulletin Board about transmission availability, scheduling, economic dispatch, service interruptions and system reliability. (See Oasis)