• Market Risk

    The exposure that results from holding an unhedged swap as market conditions change.

  • Marketable Gas


  • Marketer

    An entity engaged in bringing together sellers and buyers, usually on a spot-market basis, assisting in negotiations, and arranging transportation and delivery terms.

  • Marketing Affiliate

    Marketer owned or substantially controlled by an affiliate gas pipeline or electric utility.

  • Master Metering

    Separate metering of individual units in a new building is required if the occupant has control over energy use in the unit and if benefits exceed costs.

  • Matched Book

    A situation where a market maker has arranged exactly offsetting swap transactions so that there is no net market risk.

  • Maximum Demand

    The greatest of all demands of the load that has occurred within a specified period of time.

  • Mcf

    One thousand cubic feet of natural gas.

  • Mean Temperature

    As used by the Weather Bureau in determining degree days, the average of the maximum and the minimum dry-bulb atmospheric temperatures in degrees Fahrenheit recorded for each day.

  • Megawatt-hour (MWh)

    One million watt-hours of electric energy. A unit of electrical energy which equals one megawatt of power used for one hour.

  • Megawatt (MW)

    A unit of electrical power equal to one million watts or one thousand kilowatts.

  • Melded Rate

    A rate which reflects the combined costs of different sources of power. Typically costs of existing hydroelectric projects and costs of newer thermal plants are said to be melded when combined or averaged together in one rate.

  • Merit Dispatch

    See Economic Dispatch. The process of dispatching generator units in order of ascending marginal costs of production.

  • Metallurgical Coal

    Coal, typically bituminous, which is heated in a substoichometric atmosphere to the extent that the volatile matter of the coal is released and the coal passes through the "plastic stage" to become metallurgical coke, which is used as the carbon input in an integrated steel mill.

  • Meter, Diaphragm

    A gas meter in which gas passes through two or more chambers and moves diaphragms geared to a volume-indicating dial.

  • Meter, Five Light

    The smallest size diaphragm meter, usually installed for a domestic consumer. The standard capacity is approximately 150 cubic feet per hour. Recently a three light meter has also come into frequent use.

  • Meter, Gas

    An instrument for measuring and indicating, or recording, the volume of natural gas that has passed through it.

  • Meter, Orifice

    A meter for measuring flow of fluid through a pipe or duct by measurement of the pressure differential across a plate that has a precisely cut hole in its center.

  • Meter, Rotary Displacement

    A positive-pressure blower used as a meter in which gas pressure turns the blower and the volume of gas passing through is proportionate to the number of revolutions.

  • Meter, Venturi

    A fluid-flow meter in which the fluid flow is determined by measuring the pressure drop caused by the flow of the fluid through a Venturi throat or tube. The pressure drop across the tube is proportionate to the fluid-flow rate.

  • Metered Value

    A measured electrical quantity that may be collected by telemetering, SCADA (remote control and telemetry used to monitor system) or other means.

  • Metering

    Use of devices that measure and register the amount and/or direction of energy quantities relative to time.

  • Methane (CH 4)

    The lightest in the paraffin series of hydrocarbons. It is colorless, odorless and flammable; the major portion of marsh gas and natural gas.

  • Mill

    One-tenth of one cent. A common unit for pricing electricity.

  • Min-Max

    See Collar.

  • Minimum Charge (Minimum Bill Clause)

    A clause in a contract that provides that the charge for a prescribed period shall not be less than a specified amount.

  • Minimum Commodity Bill

    A charge that requires the purchaser to pay up to the full charge for a specified percentage of contracted amounts whether or not the specified amount of service is actually taken.

  • MMBtu

    One million British thermal units.

  • MMcf

    One million cubic feet of natural gas.

  • Model Conservation Standards

    Construction standards for new electrically heated residential and commercial structures, and conversion standards for residential and commercial structures that to electric space heating.

  • Modified Fixed-Variable Rate Design

    A rate-design methodology employed by the FERC for interstate natural gas pipelines that allocates all fixed costs except return on equity and related taxes to the demand charge, and that allocates return on equity and related taxes, all production and gathering .costs, and all variable costs to the commodity charge.

  • Money Market Swap

    Swaps with relatively short maturities, generally less than three years.

  • Monopoly

    A state of exclusive or near-exclusive ownership or control of a commodity, service or facility through legal privilege, command of supply, or concerted action, making possible the manipulation of prices.

  • Monopsony

    In contrast to monopoly, monopsony is a market condition in which there are a large number of sellers and only one buyer.

  • Most Favored Nation Clause

    A contract clause that ties the contract price to the rates paid in other contracts, usually specifying the region to be taken into consideration, such as a county, state, field, basin, or other geographic or geologic area. Generally, most favored nation clauses require that the other contracts be recent in time and for like quantity, quality and contract term.

  • Mothball

    To place a generating facility in an inactive state so that it can neither be brought into operation immediately nor counted towards reserve margin.

  • Municipal Utility

    A utility owned and operated by a municipality or group of municipalities.

  • Municipalization

    The process by which a municipal entity assumes responsibility for supplying utility service to its constituents. In supplying electricity, the municipality may generate and distribute the power or purchase wholesale power from other generators and distribute it.

  • Municipalization-Lite or Muni-Lite

    A municipal utility that owns only meters and purchases power from the wholesale market without undertaking the bur-den of acquiring significant transmission or distribution facilities.

  • Must Run Units

    A specific generating unit that has been designated by the system operator to be on line or on the grid to insure the flow of electricity. This must run unit is outside of economic dispatch and mayor may not be a system's most efficient unit. A unit may be designated as must run for operating reasons that may include system reliability, voltage control, or system stability.

  • Naked in the Option

    The owner of the option has no position in the underlying security or commodity.

  • Nameplate Capacity (or Installed Capacity)

    The full-load continuous rating of a generator, prime mover, or other electric power production equipment under specific conditions as designated by the manufacturer. Installed generator nameplate rating is usually indicated on a nameplate physically attached to the generator.

  • Nameplate Rating

    The initial capability of a piece of electrical equipment as stated on the attached nameplate. Actual capability can vary from the nameplate rating due to age, wear, maintenance or ambient conditions.


    The National Association of Utility Consumer Advocates. NASUCA includes members from 38 states and the District of Columbia. It was formed "to exchange information and take positions on issues affecting utility rates before federal agencies, Congress and the courts."

  • National Association of Regulatory Utility Commissioners (NARUC)

    A professional trade association, headquartered in Washington, D.C., composed of members of state and federal regulatory bodies that have regulatory authority over public utilities.

  • National Energy Policy Act of 1992

    A law aimed at increasing efficiency in the electric utility industry by enhancing competition in generation. It requires the opening of electric transmission access by giving the Federal Energy Regulatory Commission authority to order utilities to provide transmission to other utilities, federal power marketing agencies, or power marketers for wholesale transactions.

  • National Environmental Policy Act of 1969 (NEPA)

    A law requiring agencies to consider the environmental impacts of major federal actions and to prepare environmental impact statements (EISs) which discuss these impacts and weigh alternatives. The law also requires public participation in the EIS process.

  • Native Load

    The requirements of a wholesale utility's local retail market.

  • Natural Gas

    A naturally occurring mixture of hydrocarbon and non-hydrocarbon gases found in porous geological formations beneath the earth's surface, often in association with petroleum. The principal constituent is methane, CH4.

  • Natural Gas Act of 1938 (NGA)

    A federal statute enacted in 1938 to provide regulatory control over the interstate sale and transportation of natural gas. Under the NGA, the Federal Power Commission was given two major powers: (1) the power to issue certificates of public convenience and necessity authorizing construction and operation of facilities and the provision of services, and (2) the power to regulate rates for (a) sales in interstate commerce of natural gas sold for resale for ultimate public consumption and (b) transportation of natural gas in interstate commerce. The Act specifically provides that the NGA will not apply to other sale or transportation of natural gas or to the local distribution Df natural gas, or to the facilities used for such distribution, or to the production or gathering of natural gas.

  • Natural Gas Policy Act of 1978 (NGPA)

    A federal statute enacted in 1978 to phase out producer rate regulation between January 1, 1985 and July 1, 1987. The NGPA provides "maximum lawful prices" for those -categories of natural gas that it subjects to price regulation. The NGPA also provides for "self-implementing" transportation services, without the need for prior certificates of public convenience and necessity from the FERC under the NGA, for certain qualifying transportation by interstate pipelines on behalf of intrastate pipelines or local distribution companies or by intrastate pipelines on behalf of interstate pipelines or local distribution companies served by an interstate pipeline.

  • Natural Gas Vehicle Coalition

    Coalition to develop markets for natural gas vehicles.

  • Natural Gas Wellhead Decontrol Act of 1989

    A federal statute enacted in 1989 providing for staged decontrol of first sales with full decontrol of all categories completed by January 1, 1993.

  • Natural Gasoline

    Those liquid hydrocarbon mixtures containing substantial quantities of pentane and heavier hydrocarbons which have been extracted from natural gas.

  • Natural Monopoly

    A situation where one firm can produce a given level of output at a lower total cost than can any combination of multiple firms. Natural monopolies occur in industries, which exhibit decreasing average long run ~costs due to size (economies of scale). According to economic theory, a public monopoly governed by regulation is justified when an industry exhibits natural monopoly characteristics.

  • Neighboring System

    See Adjacent System.

  • Net Actual Generation (MWh)

    Actual number of electrical megawatt-hours generated by the unit during the period being considered less any generation (MWh) utilized for that unit's station service or auxiliaries.

  • Net Availability Capacity

    Gas Available Capacity less the unit capacity utilized for that unit's station service or auxiliaries.

  • Net-Back Price

    The effective wellhead price to the producer of natural gas, based on the downstream market price for the natural gas less the charges for delivering the natural gas to market.

  • Net Benefit

    Test In the context of ratemaking, an analysis to determine whether rolled-in or incremental rates for new construction benefit existing customers on a pipeline.

  • Net Capability

    The maximum load -carrying ability of a power plant, exclusive of station use, under specified conditions for a given time interval, independent of the characteristics of the load. Capability is determined by design characteristics, physical conditions, adequacy of prime mover, -energy supply, and operating limitations such as cooling and circulating water supply and temperature, headwater and tailwater elevations, and electrical use.

  • Net Capacity

    Total Owned Capacity + Contractor Capacity Available from Independent Power Producers + Net of Total Capacity Purchases and Sales Sum of Inoperable Capacity and Planned Outage =

  • Net Dependable Capacity

    Maximum capacity sustained by a unit in a specified period modified for seasonal limitations and reduced by the capacity required for station service or auxiliaries.

  • Net Energy for load (Control Area)

    Net system generation plus Interchange received minus Interchange delivered.

  • Net Generation:

    Gross generation less the electric energy consumed at the generating station for station use.

  • Net Internal Demand

    Metered Net Outputs of all Generators within a Sys-tem + Metered Line Flows into the System - Metered Line Flows out of the System Direct Control Load Management - Interruptible Demand = Net Internal Demand

  • Net Maximum Capacity

    Gross Maximum Capacity less the unit capacity utilized for that unit's station service or auxiliaries.

  • Net Position

    In futures trading, the difference between the open long contracts and open short contracts relating to anyone commodity.

  • Net Settlement

    A condition of a swap agreement that simplifies the settlement process by having the counterparty that owes the larger amount pay the net of the larger and smaller gross obligations.

  • Net Summer Capability

    The steady hourly output which generating .equipment is expected to supply to system load exclusive of auxiliary power, as demonstrated by tests at the time of summer peak demand.

  • Net Winter Capability

    The steady hourly output which generating equipment is expected to supply to system load exclusive of auxiliary power, as demonstrated by tests at the time of winter peak demand.

  • Netting Agreement

    A provision in a swap contract that allows for the offset of settlement payments and receipts on all contracts between the same two counterparties. Although not fully established, this provision is intended to limit default exposure to a counterparty.

  • Network

    An interconnected system of electrical transmission lines, transformers, switches and other equipment connected together in such a way as to provide reliable transmission of electrical power from multiple generators to multiple load centers. A network implies redundancy provided through the use of multiple parallel flow paths.

  • NGPA Gas Category

    Natural gas pricing 'Category created by the Natural Gas Policy Act of 1978 (NGPA). The NGPA divided all natural gas into more than 20 categories, each subject to different maximum lawful pricing rules.

  • No-Bump Rule

    Rule which protects a shipper with flowing gas from losing capacity (being bumped) by a higher priority shipper in the interruptible queue deciding to increase its gas volumes.

  • No-notice Service

    A pipeline delivery service which allows customers to receive gas on demand without making prior nominations to meet peak service needs and without paying daily balancing and scheduling penalties.

  • Nominal Voltage

    The voltage standards recommended by manufacturers of electrical equipment and the electric utilities in the United States to assure that electrical equipment will be designed for the voltage range that will be encountered in actual use so that satisfactory operation of equipment will be obtained. The Nominal Standard Distribution Voltages are established by each company for service supplied to residential and commercial customers.

  • Nomination

    A request for service under a service agreement.

  • Non-coincident Demand (NCD) or Non-coincident Peak Load

    A customer's maximum energy demand during any stated period. Customers who use large quantities of electricity may pay a monthly demand charge based on their maximum electric demand during each month. This maximum demand in the electric industry can also be called a customer's monthly non-coincident demand.

  • Non-firm Electricity Transaction

    These transactions are typically for short periods and subject to curtailment or cessation of delivery by the supplier or purchaser in accordance with prior agreements or under specified conditions. Non-firm sales are sometimes called economy or interruptible sales.

  • Non-firm Energy

    Energy that is not guaranteed to be continuously available. Non-firm energy is available in varying amounts depending upon season and weather conditions.

  • Non-jurisdictional Sales

    A direct sale by an interstate pipeline to an end user over which the FERC has no jurisdiction, as contrasted with a pipeline's sale for resale in interstate commerce which is jurisdictional.

  • Non-operator

    A working interest owner in a well or facility that is not the party designated to operate it.

  • Non-performance

    A contractual breach, such as contracted gas that is not delivered.

  • Non-recallable Available Transfer Capability (NATC)

    Transmission Capability - Transmission Reliability Margin - Non-recallable Reserved Transmission Service = Non-recallable Available Transfer Capability

  • Non-spinning Reserve

    Generating units that are not connected to the system but are capable of coming on line within a specified time, or interruptible load that can be removed from the system in a specified time.

  • Non-utility Generator (NUG)

    Facility for generating electricity that is not exclusively or primarily owned by an electric utility and which operates connected to an electric utility system.

  • Non-utility Power Producer

    A corporation, person, agency, authority, or other legal entity or instrumentality that owns electric generating capacity and is not an electric utility. Non-utility power producers include qualifying cogenerators, qualifying small power producers, and other non-utility generators (including independent power producers) without a designated franchised service area, and which do not file forms listed in the Code of Federal Regulations, Title 18, Part 141. .

  • NOPR

    Notice of Proposed Rule Making. A draft generic policy change promulgated by regulatory agencies.

  • Normal (Pre-Contingency) Operating Procedures

    Operating procedures that are normal activities of a system operator to alleviate potential facility overloads or other potential system problems.

  • Normal Rating

    The ratings as defined by the facility owner that specify the level of electrical loading (generally expressed in megawatts or other appropriate units) that a facility can support or withstand through the daily demand cycles without loss of equipment life of the facility or equipment involved.

  • Normal Voltage Limits

    The operating voltage range on the interconnected systems, above or below nominal voltage and generally expressed in kilovolts, that is acceptable on a sustained basis. (See Voltage Chart.)

  • North American Electric Reliability Council (NERC)

    As a reaction to the 1967 New York City black out, the electric utility industry formed a council in 1968 to promote the reliability and adequacy of bulk power supply in the electric utility systems of North America. NERC consists of ten regional reliability councils and encompasses essentially all the power regions of the contiguous United States, Canada, and a small portion of Mexico. There is also one affiliate member in Alaska, the Alaskan System Coordination Council. The NERC Regions are:

  • Notice of Inquiry

    FERC procedure used to gather information on a specific industry issue.

  • Notice of Proposed Rulemaking

    FERC proposal issued with the intent of changing or establishing a FERC rule.

  • NRC

    Nuclear Regulatory Commission.

  • Nuclear Fuel

    Fissionable materials that have been enriched to such a composition that, when placed in a nuclear reactor, will support a self-sustaining fission chain reaction, producing heat in a controlled manner for process use.

  • Nuclear Power Plant

    A facility in which heat produced in a reactor by the fissioning of nuclear fuel is used to drive a steam turbine.

  • Nuclear Reactor

    A device in which a fission chain reaction can be initiated, maintained and controlled. Nuclear reactors are used in the power industry to produce steam for electricity.

  • Oasis (Open Access Same-Time Information System)

    The new name of the Real- Time Information Network rule or "RINS." Required by FERC to be the only source of information on electric transmission capacity availability. For both affiliated transactions and outside entities.