Glossary

Click any of the letters below to see the definition of common terms in Energy Choice.

A B C D E F G H I K L M N O P R S T U V

A

Advanced Metering Device A device used to record or communicate actual electric use during minutes, hours, days or weeks.  This information is needed for time-of-day, on-peak/off-peak and other specialized billing rates.  May also be referred to as a ‘smart meter.’

Affiliate A company that is controlled by another or has the same owner as another company.

Aggregator An entity or an individual, licensed by the PSC, which acts on behalf of a customer (or group of customers) to buy electricity in bulk to increase customers’ buying power.

Alternative Energy Electricity generated using resources that are replaced naturally. Renewable energy may include fuels and technologies such as solar photovoltaic energy, solar thermal energy, wind power, low head hydropower, geothermal energy and biomass energy. Alternative energy sources include landfill- and mine-based methane gas, and energy from waste.

Arrearage An amount of money that is owed. Usually refers to overdue utility bills.

B

Base Load The amount of electricity needed to meet minimum demand based on reasonable expectations of customer requirements at any point in time.

Broker An entity or individual licensed by the PSC that acts as an agent or go-between in the sale and purchase of electricity but never owns the electricity.

Budget Billing (Average Payment Plan) A billing option offered by utilities and many retail electricity suppliers that allows a person to pay a fixed amount each month. Budget billing averages bills out over 12 months, so each monthly bill will be the same amount until the total bill is paid. The company may adjust the bill periodically each year, up or down, depending on the customer’s use. Residential customers may contact their electric utility and/or retail electricity supplier and request budget billing at any time.

C

Commission The Public Service Commission (PSC) of Maryland. The state regulatory agency that provides oversight, policy guidance, and direction to electric companies and retail electricity suppliers. The PSC licenses retail electricity suppliers but does not regulate the products, services, or prices that retail electricity suppliers offer. Find more information about the PSC at www.psc.state.md.us

Consent A customer’s approval of an agreement/contract with an action communicated by a written document, electronic document, or voice recording.

Consumer/Customer A retail electricity customer.

Contract An agreement between parties with terms and conditions that serve as proof of the obligation.

Customer Choice The ability to choose to buy your electricity from a retail electricity supplier. Retail electricity suppliers are licensed by the PSC, and will market electricity to you through the mail, the phone, the internet, or in person. There are three parts to your electric service: generation, transmission, and distribution. Generation is the production of electricity. Transmission is the movement of that electricity from where it is produced to a local distribution system. Distribution is the delivery of electricity to your home or business. When you shop for a retail electricity supplier, you are choosing the company that supplies your electricity. For most electricity customers who select a new retail electricity supplier, transmission costs will also be included in the charges from your new retail electricity supplier. The utility that distributes your electricity will remain the same.

D

Daily Peak The greatest amount of electricity used during a certain period in a day, such as an hour, a half-hour, or a quarter-hour, often used with time-of-use metering.

Default Service Electric power that an electric company must offer to its customers under law. See also ‘Standard Offer Service.’

Default Service Provider/Standard Offer Service Provider The electric company that provides generation services to customers who do not choose a retail supplier, are unable to find a retail electricity supplier willing to serve them, or no longer receive generation services from another retail electricity supplier.

Demand The amount of electricity customers use at any given moment or averaged over any certain period of time. It is a measure of the rate at which customers are using electricity.

Deregulation The reorganization of regulated monopoly electric service to allow operations and charges to be separated or ‘unbundled’ into electricity supply, transmission, distribution, and other services. Deregulation enables customers to buy electricity supply services from retail electricity suppliers. See also ‘Restructuring.’

Distribution The delivery of electricity to your home or business.

Distribution Charge The rate charged for delivering electricity from the electric company to your home or business. These charges are regulated by the PSC.

Distribution Line The local part of an electric system that delivers electricity to most customers after it passes through high power transmission lines.

Distribution Territory The geographic area in which an electric company provides electric transmission or distribution services to customers. Also referred to as a utility’s ‘service territory.’

Drop The removal of a customer from a retail electricity supplier’s service.

E

Electric Company An entity that physically transmits or distributes electricity in the state to a retail electric customer. See also ‘Electric Distribution Company’ and ‘Utility.’

Electric Distribution Company (EDC) The electric company that provides facilities for the distribution of electricity to retail customers. Electric distribution companies are regulated by the Maryland Public Service Commission (PSC). Exceptions include building or facility owners or operators that manage their internal distribution system and supply electric power and electric services to occupants of the building or facility. An electric utility is often referred to as an EDC.

Electric Universal Service Program (EUSP) A state-mandated program established by the PSC to help low-income customers (those with annual incomes at or below 175 percent of the federal poverty level), with bill assistance, weatherizing their homes, and eliminating unpaid bills (for electric customers who have not gotten assistance within the last seven years from this program). All Maryland utility customers pay a fee on their electricity bill to fund this program, which is administered by the Office of Home Energy Programs in the Maryland Department of Human Services.

Electricity Competition Two or more retail electric suppliers offering the same or similar goods or services in the same market place.

Electricity Supplier An entity that sells electricity, electricity supply services, competitive billing services, or competitive metering services, or that purchases, brokers, arranges, or markets electricity or electricity supply services for sale to a retail electric customer. Retail electricity suppliers are licensed by the Maryland PSC and include electricity suppliers, aggregators, brokers, and marketers of electricity.

Energy Conservation The reduction or management of energy consumption in a cost-effective and energy-efficient manner.

Enrollment The addition of a customer to a retail electricity supplier’s service.

Evergreen Contract An existing contract that automatically renews at the end of the contract period unless the customer takes action to cancel the contract.

F

Fixed Price A price that remains the same for a set period of months or years.

Flat Rate A fixed charge for goods and services that does not vary as the amount used, volume consumed, or units purchased change.

Formal Complaint An appeal of an informal complaint. In the event an informal complaint is appealed with the Consumer Affairs Division (CAD), further review by the Assistant Manager of CAD may take place. The Assistant Manager’s decision may be appealed in writing to the Commission within 10 days of its receipt. The Commission will take final action on a formal complaint by issuing an order that dismisses the complaint, directs full or partial satisfaction of the complaint, or directs any other action that the Commission finds to be warranted.

G

Generation The production of electricity.

Generation Charge The charge for producing electricity. If you purchase electricity from a retail electricity supplier, your generation charge will depend on the contract between you and your retail electricity supplier.

Green Power Electricity generated using resources that are replaced naturally. Renewable energy may include fuels and technologies such as solar photovoltaic energy, solar thermal energy, wind power, low head hydropower, geothermal energy, and biomass energy. Alternative energy sources include landfill- and mine-based methane gas, and energy from waste. See also ‘Renewable Energy.’

Grid A network for the transmission of electricity throughout the state, region, or nation. The term is also used to refer to the layout of an electric distribution system. Maryland is part of the regional grid operated by PJM. See also ‘Independent System Operator.’

H

Hourly Metering Tracking or recording a customer’s consumption during specific periods of time that can be tied to the price of energy. An Advanced Metering Device (known as a smart meter) must be used to record real-time usage. See also ‘Time of Use.’

I

Independent System Operator/Regional Transmission Operator An entity authorized by the Federal Energy Regulatory Commission to control a regional transmission grid. The Regional Transmission Operator that controls the flow of power in Maryland is PJM Interconnection.

Informal Complaint A dispute or disagreement about a utility or retail electricity supplier problem filed by a customer with the Commission’s Consumer Affairs Division (CAD). A CAD investigator reviews the informal complaint and, based on information from the customer and the electric company or retail electricity supplier, provides the customer with a response to his/her dispute. In some cases, an informal complaint is appealed within CAD and then to the Commission, where it becomes a formal complaint.

Investor Owned Utility An electric utility owned and operated by private or public investors.

K

Kilowatt (kW) (1) A measure of demand for power during a pre-set time, such as a 15-minute interval; (2) 1,000 watts; approximately 1.34 horsepower.

Kilowatt-hour (kWh) A unit used to measure energy, equivalent to one kilowatt (kW) of power expended for one hour. The amount of electricity you use each billing period is expressed in terms of a kilowatt-hour (kWh) and is noted on your bill. A 100-watt light bulb used for 10 hours is equivalent to a kilowatt-hour.

L

Load The amount of electric power required to meet customers’ use in a given period.

Load Profile Measurements of a customer’s electricity usage over a period of time that show how much and when a customer uses electricity. Load profiles can be used by retail electricity suppliers, electric utilities, and transmission system operators to forecast electricity supply requirements and to determine the cost of serving a customer.

Load Management Shifting use of electricity from periods of high demand to periods of lower demand.

M

Marketer A company, licensed by the PSC that buys and resells electricity to customers, but typically does not own generating facilities.

Maryland Energy Assistance Program (MEAP) A state program providing assistance with home heating bills. Limited assistance is available to replace broken or inefficient furnaces. For information contact the Office of Home Energy Programs Office in your area, or call 1-800-352-1446.

Municipal Electric Utility A local corporation or a division of a local corporation, that is in the business of transmitting or distributing electricity for purposes other than end use by the local corporation. Electric choice is not available in the service territories of municipal electric utilities.

N

Non-Basic Services Services not required for the physical delivery of electric service. For example, energy efficiency or load management products/services.

O

Office of People’s Counsel (OPC) An independent state agency that represents the interests of Maryland’s residential utility customers before the PSC in rate and service cases and before other state and federal regulatory agencies and courts. OPC is not part of the Public Service Commission.

Off-Peak/On-Peak Blocks of time when energy demand and price is low (off-peak) or high (on-peak).

Office of Home Energy Programs A unit of the Maryland Department of Human Services. OHEP administers the Electric Universal Service Program (EUSP). This program uses energy assistance funds from the federal government, the Maryland Energy Assistance Program, and from EUSP surcharges on all utility customer bills, to provide assistance with unpaid electricity bills to households with incomes that are below 175 percent of the federal poverty level.

P

Public Service Commission (PSC) The state regulatory agency of Maryland that provides oversight, policy guidance and direction to electric companies and retail electricity suppliers. The PSC licenses retail electricity suppliers, but does not regulate the products, services, or prices retail electricity suppliers offer.

R

Real-Time Pricing Rates that reflect the actual moment-by-moment cost of providing electricity. A smart meter must be used to record real-time usage.

Regulation A rule or law established by the federal or state government that sets procedures that an electric company and/or retail electric supplier must follow.

Reliability The provision of adequate and dependable generation, transmission, and distribution service.

Renewable Energy Electricity generated using resources that are replaced naturally. Renewable energy may include fuels and technologies such as solar photovoltaic energy, solar thermal energy, wind power, low head hydropower, geothermal energy, and biomass energy. Alternative energy sources include landfill- and mine-based methane gas, and energy from waste.

Restructuring The reorganization of traditional regulated electric service to allow operations and charges to be separated or ‘unbundled’ into generation, transmission, distribution, and other services. Restructuring allows customers to buy electricity from retail electricity suppliers.

Retail Electric Customer A consumer of electricity services.

Retail Electricity Supplier An entity that sells electricity, electricity supply services, competitive billing services, or competitive metering services, or that purchases, brokers, arranges, or markets electricity or electricity supply services for sale to a retail electric customer. Retail electricity suppliers are licensed by the Maryland PSC and include electricity suppliers, aggregators, brokers, and marketers of electricity. See also ‘Electricity Supplier.’

Rural Electric Cooperative A not-for-profit electric company that is owned by the customers it serves; in Maryland, a small rural electric cooperative is one that supplies electricity to less than 1,000 customers.

S

Slamming An illegal practice of switching a customer’s electricity supply service without his/her permission.

Smart Meter A device used to record or communicate actual electric use during minutes, hours, days or weeks. This information is needed for time-of-day, on-peak/off-peak and other specialized billing rates. May also be referred to as an advanced metering device.

Spot Market A term used to describe the wholesale purchase of electricity by retail electricity suppliers within a regional transmission organization.

Standard Offer Service Electric power that an electric company must offer to its customers under law. See also ‘Default Service.’

Sustainable Renewable energy systems that provide energy services to people without depleting resources, endangering the planet or compromising the ability of future generations to use the same energy services.

T

Terms of Service/Terms and Conditions Content of the agreement between a customer and a retail electricity supplier.

Time of Use Tracking or recording a customer’s consumption during specific periods of time that can be tied to the price of energy. A smart meter must be used to record real-time usage.

Transmission The movement of electricity from where it is produced to a local distribution system.

Transmission Charge The cost for transporting electricity from the generation source to your electric company. For most electric customers who choose a retail electricity supplier, transmission costs will be included in the charges from the new retail electricity supplier.

U

Universal Service Program A rate-payer funded energy assistance program administered by the Maryland Office of Home Energy Programs of the Department of Human Services that helps low-income customers maintain electric service, and includes customer bill assistance, unpaid bill (arrearage) assistance, and weatherization.

Usage The amount of electricity used during the billing period listed in kilowatt-hours (kWh). This will be listed on your electric bill as ‘kWh used.’

Utility An entity that physically transmits or distributes electricity in the state to a retail electric customer. See also ‘Electric Distribution Company.’

Utility Consolidated Billing A customer bill from a utility that contains both retail electricity supplier and utility charges.

V

Variable Price A price that can change by the hour, day, month, etc.