At AquaSwitch we have worked hard to compile a large collection of simple energy guides explaining everything there is to know about the UK business energy market, to help you become more energy-efficient and save costs on your energy bills.
However, we want to go a step further and provide you with this glossary of business energy terms so that the jargon doesn’t stop you from becoming an expert in business energy efficiency.
Glossary Sections
Use the following links to navigate to the section that best describes the term you are looking for [Insert Anchor Stamps]:
Energy Market Actors
Business Energy Supplier: A company operating in the UK with a license from Ofgem to provide electricity and gas services to non-domestic properties. Services include billing and customer services.
Energy Producer/Wholesaler: A company that produces energy (gas or electricity) and sells it to energy suppliers. Energy Suppliers tend to be the producers too, particularly the ‘big six’.
Ofgem: The Office of Gas and Electricity Markets is the government regulator for the electricity and downstream natural gas markets in the UK.
International Energy Agency (IEA): Autonomous international organisation that acts as an energy policy advisor for its member states.
BEIS: The Department for Business, Energy and Industrial Strategy is a UK ministerial department that is responsible for putting energy policy into practice.
Electricity Infrastructure
Electricity Grid: An interconnected network for electricity transfer between power stations (producers) and households, businesses and government institutions (consumers).
Smart Grid: An electrical grid that uses large amounts of data gathered from smart devices to automate and optimise the production, transmission, storage and delivery of electricity.
Power Stations: An industrial facility for the generation of electricity that is connected to an electrical grid. This may include energy from fossil fuels, or from green or renewable energy sources.
Electrical Transmission Lines: Power lines (overground, undersea) that transfer electricity at high voltage over long distances. The UK’s electrical grid is owned and operated by private transmission companies.
Electrical Substations: Industrial facilities that transform the voltage of an electrical grid for transmission and distribution (i.e. high voltage for long-distance transmission, low voltage for local distribution). In the UK they are owned and operated by private transmission companies.
Gas Infrastructure
National Transmission System (NTS): The UK’s network of gas pipelines that connects natural gas coastal terminals (that receive the extracted offshore gas) with gas power stations, LNG storage sites and commercial and domestic consumers. It is owned and managed by National Grid plc.
Independent Gas Transformer: A private company that owns and manages the gas pipes between the principal gas transmission pipes operated by the National Grid and those of individual properties.
Energy Devices
Business Energy Meter: A device used to measure the amount of gas and electricity used in a business property.
Multi-Site Energy Meter: The process by which a business owning multiple properties can be supplied with gas and electricity in a single contract. NOT an actual device.
Smart Meter: A digital device that sends real-time energy usage data to the contracted energy supplier, generally via an encrypted wireless network.
Business Energy Monitor: A device that lets a user visually track the amount of energy being measured by a smart meter via an independent sensor.
Heat Pumps: A device that transfers heat from the outside of a property to the inside through a process similar to that powering your refrigerator, using electrically-powered pumps.
Energy Policy and Climate Change
Carbon Credit: A tradeable certificate representing the removal of one tonne of carbon dioxide from the atmosphere. It is used in both the Compliance and Voluntary markets.
Emission Trading Scheme (ETS): An economic mechanism that uses the ‘cap and trade’ principle to reduce a country’s greenhouse gas emissions according to its international targets.
Carbon Neutral: A term describing a state where carbon emissions are equal to carbon removals, particularly when referring to the carbon balance of a process, activity or entity.
Net-Zero: A term describing a state where carbon emissions are equal to carbon removals which is often used to describe the broader commitment to decarbonisation and climate action.
Renewable Energy Guarantees of Origin Scheme (REGO): A government scheme that forces business suppliers to disclose the origin of any electricity purchased, with particular attention to its carbon emissions.
Smart Export Guarantee: A government initiative allowing British property owners to generate their own renewable energy and sell this back to the national grid.
Feed-in-Tariff Scheme: A now-defunct government scheme designed to allow businesses and households to generate renewable energy and sell it back to the national grid. Replaced in Jan 2020 by the less generous Smart Export Guarantee.
Microgeneration Certification: A certification given to a business or household for meeting all engineering and legal standards for selling green electricity back to the grid through the Smart Export Guarantee.
Green Gas Support Scheme (GGSS): A government scheme encouraging investment in biomass gas plants (e.g. turning food waste into biomethane gas).
Building for 2050 – A UK government study investigating low-carbon building designs
Green Gas Levy (GGL): A quarterly tariff paid by licensed business gas suppliers in the UK to fund the GGSS (see above).
Energy Types
Green Energy: Energy in the form of heat or electricity that is renewably sourced and has a small environmental impact.
Clean Energy: A generic term used with little rigour to describe energy sources that are both renewable and low-carbon.
Low-Carbon Energy: Low-carbon energy or power refers to the electricity generated from energy sources that emit significantly less greenhouse gas emissions than conventional fossil fuels.
Biomass Energy: Energy in the form of heat, electricity or biofuels that is extracted from residue or grown organic matter.
Tidal Energy: Energy in the form of electricity extracted from the inflow and outflow of water caused by the orbit of the moon.
Wind Energy: Energy extracted from wind using wind turbines, usually in the form of electricity.
Solar Energy: Energy extracted from solar radiation through the use of photovoltaic panels, usually in the form of electricity or heat.
Geothermal Energy: Energy extracted from the Earth’s natural heat at depth by utilizing boreholes to extract steam to drive turbines at the surface.
Fossil Fuels: Fossil fuels are liquid or gaseous hydrocarbons that formed underground over millions of years from buried organic matter subject to extreme heat and pressure.
Nuclear Energy: Energy extracted from radioactive materials through the process of nuclear fission.
Energy Bills
Energy Standing Charges: A fixed daily tariff paid to energy suppliers to cover the cost of maintaining the connection of your property to the electricity and gas networks.
Climate Change Levy: A government tax on business energy bills designed to encourage reductions in greenhouse gas emissions.
VAT: The Value-added tax (VAT) is a consumption tax of 20% levied on goods and services sold in the UK.
Standard-Rate Tax: A transaction that incurs the usual amount of VAT tax at 20%.
Zero-Rated Tax: A transaction that incurs a tax of 0% VAT.
MPAN: Meter Point Administration Number, also known as the “S Number” or “Supply number” is a unique identifier code for your business property’s electricity supply point.
MPRN: Meter Point Reference Number, occasionally known as the “M Number” is a unique identifier code for your business property’s gas supply point.
Fuel Mix Table: Shows the energy source distribution for the energy provided to your property.
BACS Payment: An electronic system to make payments directly from one bank account to another using a Sort Code and Account Number.
