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Glossary of Terms
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Aggregate
To bring individual power purchasers or multiple accounts of a single customer together into a group to add together (or aggregate) their electricity demand.
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Alternative Retail Electric Supplier
Every person, cooperative, corporation, municipal corporation, company, association, joint stock company or association, firm, partnership, individual, or other entity, their lessees, trustees, or receivers appointed by any court whatsoever, that offers electric power or energy for sale, lease or in exchange for other value received to one or more retail customers, or that engages in the delivery or furnishing of electric power or energy to such retail customers, and shall include, without limitation, resellers, aggregators and power marketers, but shall not include electric utilities (or any agent of the electric utility to the extent the electric utility provides tariffed services to retail customers through that agent).
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Base Rates
The rates for those tariffed services that the electric utility is required to offer or tariffs that were in effect prior to October 1, 1996.
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Co-generation
A practice where an industrial or institutional customer will produce steam on their premises to heat adjoining buildings, run machinery and run turbines to generate their own electric power.
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Competitive Services
Includes any service that has been declared to be competitive pursuant to the legislation, contract service, and services, other than tariffed services, that are related to, but not necessary for, the provision of electric power and energy or delivery services.
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Delivery Services
Those services provided by the electric utility that are necessary in order for the transmission and distribution systems to function so that retail customers located in the electric utility’s service area can receive electric power and energy from suppliers other than the electric utility, and shall include, without limitation, standard metering and billing services.
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Direct Access Model
A model deregulating the generation side of the business, where retail electric customers purchase electricity directly from generation companies or marketers.
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Distribution System
Network of medium- and low-voltage lines used to distribute power from Transmission lines (see Transmission network) to local business and residential power users.
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Illinois Commerce Commission (ICC)
The Illinois state regulatory agency that governs retail utility rates, sets profit levels and also issues approvals for the construction of new generation and transmission facilities. There are regulatory commissions in all 50 states and the District of Columbia.
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Independent System Operators (ISO)
ISOs operate, but do not own, transmission systems. On an hour-by-hour basis, the ISO plays traffic cop for buyers and sellers using energy transmission systems. Because power takes the route of least resistance and pays no attention to company boundaries, all providers transmitting energy affect each other when energy flows over transmission lines. Several large transactions taking place simultaneously can cause reliability problems for companies in the middle. An independent organization with jurisdictional control is supposed to avoid bottlenecks or other problems—and ensure some measure of reliability.
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Midwest Independent Transmission System Operator (MISO)
A fully integrated regional transmission organization. The non-profit MISO assures industry consumers of unbiased regional grid management and open access to the transmission facilities under MISO’s functional supervision. MISO optimizes the efficiency of the interconnected system, provides regional solutions to regional planning needs, and continually minimizes any risk to reliability.
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Power Marketer
A company that sells power and either buys or generates on its own. Power marketers are required to be certified by the Federal Energy Regulatory Commission (FERC). A Power Marketer may also be an Alternative Retail Electric Supplier (ARES).
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Public Utility Regulatory Policies Act (PURPA)
Signed into law on November 8, 1978 as the National Energy Act. PURPA is a broad statute aimed at expanding the use of co-generation and renewable energy resources. PURPA created a new class of power producers called "qualifying facilities" (QFs). PURPA requires utilities to buy power from non-utility generators who qualify under PURPA’s criteria. QF generators include those power producers that use renewable and alternative energy sources such as hydro, wind, solar, geothermal energy, biomass, municipal solid waste or landfill gas fuel to generate power. Other QF producers include co-generators.
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Real Time Pricing
Charges for delivered electric power and energy that vary on an hour-to-hour basis for non-residential retail customers and that vary on a periodic basis during the day for residential retail customers.
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Retail Customer
A single entity using electric power or energy at a single premise and that is receiving or is eligible to receive tariffed services from an electric utility, or that is served by a municipal system or electric cooperative.
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Retail Wheeling
A transmission or distribution service by which utilities deliver electricity sold by a third party directly to retail customers. This service would allow an individual retail customer (end-use customer, such as home, business or factory) to choose his or her electricity supplier and receive delivery using the power lines of the local utility.
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Stranded Costs
Utilities incurred costs to serve their customers with the understanding that state regulatory commissions would allow the costs to be recovered through electric rates. Due to changes in regulations or deregulation, these costs could be stranded and their recovery is uncertain, because the costs are now above market prices. They include deferred taxes, social policy costs, generating plants whose costs of making power are above the market price, purchased power agreements and other items.
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Tariffed Services
Services provided to retail customers by an electric utility as defined by its rates on file with the Commission pursuant to the provisions of Article IX of the Illinois Public Utilities Act, but shall not include competitive services.
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Transition Charge (TC)
The Transition Charge provides a mechanism for utilities to recover a portion of their lost revenue that results from customers switching to alternative power supply options versus continuing to receive all of their power and energy needs from the local utility as a bundled product. The Transition Charge only applies to customers that elect Delivery Services and is expressed as a cents per kWh charge which is applied to all delivered kWh. Illinois electric utility companies are allowed to collect Transition Charges through the end of 2006. Sometimes also called Competitive Transition Charge (CTC).
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Transmission Network
Network of high-voltage, high-capacity lines that carry power great distances (often from state to state) from generation plants to local distribution systems for distribution to businesses and residential power users.
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Unbundling
Electric service is traditionally provided on a bundled basis, meaning that generation, transmission and distribution services are provided as a single package. By unbundling, the packaged offering of the various services that make up traditional utility service would be separated into discreet, separately priced components.
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Wholesale Customer
Power marketers, rural electric cooperatives, and municipal utilities; any customer who purchases electric power for resale to end-use customers.
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