Glossary of Terms

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C

Calculated Bill (Also Interim Bill or Estimated Bill): A bill for service not based on meter readings for the period being billed but based on calculations of how much gas a customer used during a particular period of time utilizing the gas consumption history of that customer and temperatures during the period.
Call: Grants the buyer of the option the right, but not the obligation, to buy the underlying commodity or security from the seller of the call option at a specified price at any time up to and including the expiration of the option.
Capacity Assignment/Brokering: The sale or assignment of a specific right to firm transportation (or storage) on an interstate natural gas pipeline to another entity. In some instances, transportation capacity rights may be rebrokered. The Commission’s general policy is to require the initial assignor or broker to remain obligated to the pipeline for scheduling and payment of charges.
Capacity Charge: (See Demand Charge)
Capacity Margin: Excess electric generating capacity, beyond planned peak system demand. It is reserved for emergencies and generally specified by NERC standards.
Capacity Release: A mechanism by which holders of firm interstate transportation capacity can relinquish their rights to utilize the firm capacity to other parties that are interested in obtaining the right to use that capacity for a specific price, for a given period of time and under a specifically identified set of conditions. The firm transportation rights may include transmission capacity and/or storage capacity.
Capacity Rights: Refers to the level of firm transportation service to which a customer has a contractual right.
Capacity, Effective: The maximum load which a machine, apparatus, device, plant, or system is capable of carrying under existing service conditions.
Capacity, Peaking: The capacity of facilities or equipment normally used to supply incremental gas under extreme demand conditions; generally available for a limited number of days at maximum rate.
CAPEX: Capital Expenditure.
Capital Costs: Costs incurred in acquiring capital assets. Capital costs are capitalized and recovered through yearly charges for depreciation and amortization rather than being expensed and recovered in the year incurred.
Capital Structure: The long term debt and equity of a company. In ratemaking the capital structure is projected at the end of the test period (or when new rates are expected to go into effect) and used to determine the rate of return on rate base.
Capital Structure, Hypothetical: When a subsidiary company has a parent company that provides consolidated financing and other services that affect the subsidiary’s capital structure, the subsidiary typically must prepare a hypothetical capital structure for use in a rate case filing.
Captive Customers: Buyers who can purchase gas only from one pipeline or supplier and have no access to alternate fuel sources.
Carbon Dioxide (CO2): A gas which is a product of combustion resulting when carbon unites with sufficient oxygen to produce complete combustion; a component of many natural gases.
Carbon Monoxide (CO): A poisonous, combustible gas formed by incomplete combustion of carbon, or reduction of carbon dioxide.
Cash Incentive: An incentive in the form of a rebate or cash payment that is used to induce customers to participate in a DSM program.
Cashout Provisions: To the extent a shipper violates balancing provisions, any difference between receipts and deliveries will be “cashed out”, with the pipeline purchasing excess receipts at below-market prices and selling receipt shortages at above-market prices.
Casinghead Gas: Unprocessed natural gas containing natural gasoline and other liquid hydrocarbon vapors produced from an oil well. Frequently called WET GAS, ASSOCIATED GAS (but not all wet gas or associated gas is casinghead gas), and in the past, BRADENHEAD GAS. Technically, the term should apply only to gas produced from the casing of an oil well, and not from the tubing, but it is often applied to any gas produced in association with oil.
Cast Iron Pipe: Pipe made of pouring molten iron into molds.
Cathode: Negative electrode in an electrolytic system. See ANODE.
Cathodic Protection: A technique to prevent the corrosion of a metal surface by making that surface the cathode of an electrochemical cell.
Ceramic Radiants: Baked clay devices which become incandescent and radiate heat released to them by a gas flame.
Certificate Condition: A condition imposed by the FPC or FERC when granting a Certificate of Public Convenience and Necessity.
Certificate of Public Convenience and Necessity: A special permit (which supplements the franchise), commonly issued by a state commission, which authorizes a utility to engage in business, construct facilities, or perform some other service. Also, a permit issued by the Federal Energy Regulatory Commission to engage in the transportation or sale for resale of natural gas in interstate commerce or to construct or acquire and operate any facilities necessary therefore, to which certificate the Commission may attach such reasonable terms and conditions as the public convenience and necessity may require.
Check Meter: A device for measuring utility service consumption within individual dwelling units where the utility service is supplied through a master meter.
China Walls: An expression that refers to the complete separation of operations for affiliated companies within a corporation to prevent undue business advantages. Pipeline companies, for example, are expected to have “china walls” separating their transportation departments from marketing affiliates to ensure that all customers moving gas on the pipeline get equal treatment.
Chromatograph: An instrument used to analyze the make-up of various substances, and often used to determine the Btu content of natural gas. CI=Certificate (Independent Producer), CP=Certificate (Pipeline), CS=Certificate (Small Producer), FA=Financial Audits, GP=General Proceeding, GT=General Tariff Change, IN=Investigation, PL=General Policy, RI=Rates (Independent Producer), RM=Rulemaking, RP=Rates (Pipeline), SA=Staff Adjustments (NGPA), ST=Sales under 311(b), transportation under 311(a), assignments under 312 of NGPA, TA=Annual tracking filing, TC=Curtailment Tariff, TF=Tariff Filing, TM=Monthly tracking filing, TQ=Quarterly tracking filing
City Gate (Town Border Station): See GATE STATION.
City Gate Rate: The rate charged a distribution company by its supplier(s). It refers to the cost of the gas at the point at which the distribution utility takes title to the gas.
City Gate Station: Point at which a distribution gas company receives gas from a pipeline company. See GATE STATION.
Class of Service: Defines the type of customer. The common classes of service applied to ultimate consumers, and considerably more completely described in the A.G.A. publication “Definitions of a Gas Customer and Classes of Service for Industry Reporting Purposes”, are: 1.Residential Service: Covers service to customers for domestic purposes (single, multifamily, or mobile homes, etc.). In residential service, the number of housing units within a structure determines the customer classification. 2.Commercial Service: Covers service to customers engaged in wholesale or retail trade, agriculture, communications, finance, fisheries, forestry, government, insurance, real estate, transportation, etc., and to customers not directly involved in other classes of service. 3.Industrial Service: Covers service to customers engaged primarily in a process which either involves the extraction of raw materials from the earth or a change of raw unfinished materials into another form or product.
Clause, Adjustment: A provision in a utility tariff which provides for periodic changes in charges or credits to a customer due to increases or decreases in certain costs over or under those included in base rates and incurred by the seller such as purchased gas cost, transportation costs, or advance payments made for gas.
Co-firing: The process of burning natural gas in conjunction with another fuel.
Coal Equivalent of Fuels Burned: The quantity of coal (tons) of a stated kind and heat value which would be required to supply the Btu equivalent of all fuels burned. In determining this coal equivalent, the Btu content of other fuels is generally divided by the representative heat value per ton of coal burned.
Coal Gas: Manufactured gas made by distillation or carbonization of coal in a closed coal gas retort, coke oven, or other vessel.
Coal Gasification: A controlled process of reacting coal, steam, and oxygen under pressure and elevated temperature. The crude gas is purified and has a low heating value. Subsequent catalytic upgrading can be employed to produce high-Btu pipeline grade gas.
Cogeneration: The use of a single prime fuel source in a reciprocating engine or gas turbine to generate electrical and thermal energy in order to optimize the efficiency of the fuel used. The dominant demand for energy can be either electrical or thermal. Usually it is the latter with excess electrical energy, if any, being transmitted into the local power supply company’s lines (with a reciprocal situation existing when electrical demands exceed the cogeneration plant’s output). A parallel exists with total energy plants, which are typically designed for the electrical demands rather than thermal. Under the 1978 Public Utility Regulatory Policies Act (PURPA), regulated utilities are required to purchase electricity furnished by cogenerators and small power producers at rates set by regulatory bodies having jurisdiction over the utility receiving the electricity based on “full avoided cost.”
Combination Utility: Utility which supplies both gas and some other utility service (electricity, water, etc.). For purposes of A.G.A. statistics, a combination utility derives at least 5 percent but less than 95 percent of its total operating revenues from gas operation.
Combined Accounts: When two or more meters are combined for billing purposes under the following conditions: Where combinations of meter readings are specifically provided for in rate schedules. Where the maintenance of adequate service and/or where a company’s operating convenience shall require the installation
Combined Pumped-Storage Plant: A generating plant that uses a combination of stream-flow and pumped water to generate electricity.
Combined-Cycle: The utilization of waste heat from large gas turbines to generate steam for conventional steam turbines, thus
Combustion: Rapid chemical reaction of oxygen with fuel accompanied by the production of heat, or heat and light.
Commingled Gas: A homogeneous mix of gas obtained from various physical and contractual supply sources.
Commission: Federal Energy Regulatory Commission (FERC), or local public utility regulatory commission (PUC).
Commodity Charge: A charge per unit volume or heat content (i.e., therm) of gas delivered to the buyer. Compare DEMAND CHARGE.
Commodity Cost: The cost of natural gas as purchased by Black Hills Energy. The natural gas market is volatile and this cost can change from day-to-day. Black Hills Energy does not profit from the cost of gas. We sell the commodity to customers at our cost. Commodity cost make up about 85 percent of a customer's bill. The remaining 15 percent of the bill covers our cost for service and potential profit. Cost for service and potential profit are regulated by the state public utilities commission. Commodity cost is not regulated, so there isn't any approval but the Commission does review our buying policies and cost to make sure we continue to provide the best pricing we can.
Commodity Cost: The cost of natural gas as purchased by Black Hills Energy. The natural gas market is volatile and this cost can change from day-to-day. Black Hills Energy does not profit from the cost of gas. We sell the commodity to customers at our cost. Commodity cost make up about 85 percent of a customer's bill. The remaining 15 percent of the bill covers our cost for service and potential profit. Cost for service and potential profit are regulated by the state public utilities commission. Commodity cost is not regulated, so there isn't any approval but the Commission does review our buying policies and cost to make sure we continue to provide the best pricing we can.
Commodity Costs (Rate): That part of the total cost of service which must be recovered through use of a commodity rate; i.e., a rate for each Mcf of gas sold. Revenue from a commodity rate varies with throughput.
Common Plant: Utility plant used by a combination utility company (i.e., one which renders more than one utility service, such as gas and electric) to such extent and in such manner as to render segregation impractical, as would be the case of a garage housing gas utility and electric utility trucks.
Common Trench: A trench containing two or more utilities.
Communities (Served): A community is a contiguous built-up area, incorporated or unincorporated, commonly recognized as a separate entity. Any incorporated area and its adjacent built-up unincorporated area may be counted as one community.
Company Storage: Natural gas storage facilities owned and controlled by the LDC.
Comparability of Service: Refers to the comparability of quantity and quality of firm transportation service offered to the pipeline’s firm bundled sales service. Aspects of comparability include access to storage and production area facilities, flexibility of receipt and delivery points, balancing requirements and other terms and conditions of service. There must be sufficient comparability of service, as well as DIVERTIBLE GAS SUPPLIES, in order to determine that a pipeline’s market is competitive as firm transportation cannot be a viable alternative to the pipeline’s sales service if transportation service is not comparable. The Commission has found that one way of enhancing comparability is for customers to convert all of their sales entitlements to firm transportation and for the point of sale from the pipeline to be moved upstream to the wellhead or to a HEADSTATION. In this way, all gas on the mainline is transportation gas.
Completion: Activities subsequent to drilling undertaken to finish work on a well and bring it to a productive status.
Compressed Natural Gas (CNG): Natural gas in high-pressure surface containers that is highly compressed (though not to the point of liquefaction). CNG is used extensively as a transportation fuel for automobiles, trucks and buses. Small amounts of natural gas are also transported overland in high-pressure containers.
Compression: The action on a material which decreases its volume as the pressure to which it is subjected increases.
Compressor: A mechanical device for increasing the pressure of a gas.
Compressor Stations: Locations along the interstate pipeline at which large (thousands of horsepower) natural gas-powered engines increase the pressure of the market natural gas stream flowing through the station by compression.
Consenting Party: A party (the company, staff, a customer, or other interested party) that supports a stipulation and agreement or settlement in a rate or other proceeding. See STIPULATION & AGREEMENT, CONTESTING PARTY.
Conservation Program: A utility-sponsored program that attempts to reduce a customer’s energy consumption, over most, or all hours of the day.
Consumer, Gas: The ultimate user of gas, as contrasted to a “customer” who may purchase gas for resale.
Consumption: The quantity of natural gas used by ultimate consumers.
Content of Fuel: The heat value per unit of fuel expressed in Btu as determined from tests of fuel samples. Examples: Btu per pound of coal, per gallon of oil, per cubic foot of gas.
Contesting Party: A party (staff, a customer, or other interested party) that does not support a stipulation and agreement or settlement in a rate or other proceeding, and prefers to take the case to hearing. The filing company can not be a contesting party; in that case there is no settlement. See STIPULATION & AGREEMENT, CONSENTING PARTY.
Contingency Reserve: Operating reserve that allows a generating facility to reduce control area error to zero within 10 minutes after the loss of generating capacity.
Continuous Rating: The amount of electricity that a system, facility, or element can support or withstand indefinitely without “burning up.” (See also Emergency Rating.)
Contract Assignment: A mutual agreement to release or ascribe a contractual obligation from the original contractor to another party.
Contract Balancing: A process of managing the difference between the quantities received and delivered at various points under a contract during a defined period of time (i.e., hourly, daily, monthly, etc.).
Contract Demand: The maximum amount of service that a party agrees to furnish over a given time (daily, monthly or annually) and for which a buyer agrees to pay a set charge.
Contract Demand (CD): The amount of the system’s capacity to deliver energy which a distributor agrees to reserve for a particular customer and for which the customer agrees to pay a demand charge as specified in the applicable tariff. Also, the daily quantity of energy which a supplier agrees to furnish and for which the buyer agrees to pay, under a specific contract.
Contract Storage: Storage facilities, or a portion of storage facilities, which are leased to others for the purposes of storing gas. The portion of storage facilities which has been made available to others may not be used by the pipeline for system supply. See SYSTEM STORAGE.
Contributions in Aid of Construction (Non-Refundable): The contributions or donations in cash, property, or services from companies, states, municipalities, other governmental agencies, individuals, and others for construction purposes, now carried as a plant item. Compare ADVANCES FOR CONSTRUCTION.
Control: A device designed to regulate the gas, air, water, and/or electrical supply to a gas-consuming or any other device.
Control Area: Generally, a utility’s service area.
Control Gas: That part of the main gas flow which is separated and used to actuate the automatic valve through a moving member such as the diaphragm in a diaphragm valve.
Conversion to Natural Gas: Changing the gas service to ultimate customers from a fuel other than natural gas to natural gas, including adjustment of consumers’ appliances to perform satisfactorily with natural gas. Natural gas does not necessarily mean straight natural gas; stabilizing the heat content of the sendout gas by diluent gases or enriching gases is not considered to change the basic character of natural gas. For the purpose of uniform reporting, a company should be considered a natural gas company when 95 percent of the system has been converted.
Core Customers: Residential and small commercial customers who must rely on the traditional distributor bundled service of sales and transportation. Compare NON-CORE CUSTOMERS.
Corrosion: Destruction of a metal by chemical or electrochemical reaction with its environment.
Corrosion Prevention: The halting or elimination of metal damage through use of protective methods and devices.
Corrugated Stainless Steel Tubing (CSST): An assembly of corrugated stainless steel tubing, distribution manifold(s), tube connection fittings, and tube shielding devices, intended for field assembly and installation in residential or commercial buildings to distribute fuel gas to gas utilization equipment within the building. The piping system may also include a gas pressure regulator(s), a shutoff valve(s), and other approved devices or components.
Cost Adjustment Summary (CAS): The Cost Adjustment Summary charge on customer's billing is not a new charge, BHP just changed the way billing is itemized. The base rate used to include some fuel and purchased power costs and transmission costs. Anything over or under these amounts were recovered through the Fuel and Purchased Power Adjustment and a Transmission Cost Adjustment.
Cost Allocation: The rate design step that allocates the demand and commodity costs of the various functions to the customer classes. See COST OF SERVICE.
Cost of Capital: The weighted average of the cost of various sources of capital, generally consisting of outstanding securities such as mortgage debt, preferred and preference stock, common stock, etc., and retained earnings, but which may include other interest-bearing obligations or sources of capital such as short-term notes, customer security deposits; and which may also include noninterest-bearing sources such as funds generated through use of deferred taxes, i.e., accelerated amortization, accelerated depreciation, and accumulated investment tax credit (subject to tax law limitations). The weight to be used for each source of funds generally is the percentage of each fund outstanding to the total amount outstanding of all sources of funds considered; however, target or projected ratios may also be used. The cost rate assigned each source may be the average cost of all obligations outstanding or projected costs for each source or a rate specifically assigned by a commission. The summation of the product of the weight (percentage) of each source to the total source times its cost is the cost of capital.
Cost of Service: A term used in public utility regulation to mean the total number of dollars required to supply any total utility service (i.e., revenue requirements); it must include all of the supplier’s costs, an amount to cover operation and maintenance expenses, and other necessary costs such as taxes, including income taxes, depreciation, depletion, and amortization of the property not covered by ordinary maintenance. Included also is a fair return in order that the utility can maintain its financial integrity, attract new capital, and compensate the owners of the property for the risks involved. A “cost of service study” is made in order to assist in determining the total revenue requirements to be recovered from each of the various classes of service. The amounts to be recovered from each of the classes of service are determined by the management or a commission after study of the various factors involved in rate design. Cost analysis or cost allocation is an important factor in rate design but only one of several important factors. Cost analysis does not produce a precise inflexible “cost of service” for any individual class of service because cost analysis involves judgment in certain cost areas. Its principal value is in determining the minimum costs attributable to each class of service. Other factors that must be considered in rate design are the value of the service, the cost of competitive services, the volume and load factor of the service and their relation to system load equalization and stabilization of revenue, promotional factors and their relation to the social and economic growth of the service area, political factors such as the sizes of minimum bills, and regulatory factors.
Cost of Service Tariff: A special type of tariff which allows a gas pipeline to adjust periodically for any overage or underage in recovery of its cost of service (including per unit adjustments for loss of load). In contrast, a normal fixed-rate tariff, while specified based upon a cost of service estimate, does not provide for recovery of any previous underage or return of any overage above actual costs incurred.
Coupling: A sleeve-type fitting used to connect two pipes of similar or different materials, providing insulation or continuity.
Cross Over: Piping used to connect two or more pipelines.
Cross Subsidization: Practice of charging one customer class with rates that are higher than the cost of service for that class, thus allowing another class to be charged rates that are lower than the respective cost of service for that class.
Cubic Foot: The most common unit of measurement of gas volume. It is the amount of gas required to fill a volume of one cubic foot under stated conditions of temperature, pressure, and water vapor.
Cubic Foot Metered: The quantity of gas that occupies one cubic foot under pressure and temperature conditions in the meter.
Cubic Foot, Standard: That quantity of gas which under a pressure of 14.73 PSIA and at a temperature of 60 degrees farenheit occupies a volume of one cubic foot without adjustment for water vapor content.
Curb Box: A vertical tube, capped at ground level, and usually located near the street, that protects access to the underground shut-off valves on service lines to residential and small commercial customers. (Usually found in sidewalk with gas company name).
Curb Stop or Curb Valve: A shut-off valve in a gas service line, usually between the curb and the customer’s property line.
Curtailability: In a curtailable interruptible electric service program, the customer agrees to pledge a minimum amount of electricity that can be curtailed (interrupted or withheld) by the utility during emergencies, generally in exchange for a lower rate, known as an interruptible rate.
Curtailment: Curtailment of gas service is a method to balance a utility’s natural gas requirements with its natural gas supply. Usually there is a hierarchy of customers for the curtailment plan. A customer may be required to partially cut back or totally eliminate his take of gas depending on the severity of the shortfall between gas supply and demand and the customer’s position in the hierarchy.
Customer: An individual, firm, or organization which purchases service at one location under one rate classification, contract, or rate schedule. If service is supplied at more than one location or under more than one rate schedule, each location and rate schedule shall be counted as a separate customer unless the consumption at the several locations is combined before billing and billed on one rate schedule. See CLASS OF SERVICE.
Customer Charge: A fixed amount to be paid periodically by the customer without regard to demand or energy consumption.
Customer Costs: The costs directly related to serving the customer, regardless of sales volume such as meter reading, billing, and fixed charges for the minimum investment required to serve a customer.