Our use of cookies UK Business Energy Glossary
At AquaSwitch, we have worked hard to compile a large collection of useful 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.
Use this glossary of business energy terms to navigate the jargon and become an expert in business energy.
Pro Tip: Use CTRL + F and type in your term!
Glossary Sections
Use the following links to navigate to the section that best describes the term you are looking for:
- Energy Market Actors
- Electricity Infrastructure
- Gas Infrastructure
- Energy Devices
- Energy Policy and Climate Change
- Energy Sources & Types
- Energy Storage
- Electric Vehicles (EVs)
- Energy Contracts & Bills
- Energy Services & Bills
Energy Market Actors
Business Energy Supplier: A company operating in the UK with a license from Ofgem to provide electricity and gas to non-domestic properties. Services include billing and customer services.
Energy Generators: A company that produces energy (gas or electricity) and sells it to energy suppliers. Some energy suppliers and producers are owned by the same parent company/brand, like 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.
Business Energy Brokers: Intermediaries that help companies find and negotiate business energy contracts with suppliers, providing expertise and guidance to secure favourable energy deals.
Drax: The company that owns and operates the UK’s largest power station, a biomass plant.
Electricity Infrastructure
Electricity Grid: An interconnected network for electricity transfer between power stations (producers) and households, businesses and government institutions (consumers).
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. Find a map of all power stations (generators) on our UK Power Insights page.
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 and overseen by the National Grid.
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.
Distributed Grid: An electricity network that integrates various small-scale power generation sources, like solar or wind, close to the consumption point.
Interconnectors: Undersea cables connecting the National Grid to the European continent and Ireland, used to import and export electricity.
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 Transporter: 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.
Liquid Natural Gas (LNG): Natural gas that has been cooled down to below -162°C and turned into a liquid that is much denser and easier to transport without pipelines.
Energy Devices
Business Energy Meter: A device used to measure the quantity 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.
Commercial Smart Meter: A digital device that sends real-time energy usage data to the contracted business energy supplier, generally via an encrypted wireless network.
Half-hourly Meter: An electricity meter that records energy consumption in 30-minute intervals, providing detailed data for accurate billing and energy management purposes.
Maximum Demand Meter: A business electricity meter that measures and records the highest level of power demand during a specified period.
Business Energy Monitor: A device that lets a user track the amount of energy being measured by a smart meter using 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.
Voltage Optimisation: A technology used to regulate and reduce the voltage of the electricity supply in a building.
Solar Prisms: A device that heats water by circulating it in a coiled pipe inside a prism exposed to sunlight.
Gas Boiler: A heating system that uses natural gas or biogas to heat water. There are Combi, Heat-only, System and Condensing boilers.
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 anthropogenic atmospheric carbon emissions are equal to anthropogenic atmospheric carbon removals. Often used to describe the broader commitment to decarbonisation and climate action, rather than the balance itself.
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 that allows 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 Bill Relief Scheme: A past scheme to help non-domestic customers with their energy bills. Replaced by the EBDS (see below) in April 2023.
Energy Bill Discount Scheme: An automatic discount applied to the energy bills of eligible non-domestic properties between April 2023 and April 2024. The scheme is part of the Energy Prices Act of 2022 in response to the energy crisis of the same year.
Contracts for Difference (CfD) Scheme: A UK government initiative that provides financial support to low-carbon electricity generation projects, ensuring a fixed price for their energy output.
Levelised Cost of Electricity (LCOE): The net present value of the unit cost of electricity over a system’s lifetime, considering all costs (capital, operational, maintenance) and the system’s output.
Electricity Arbitrage: An electricity trading strategy involving the purchase for consumption/storage of electricity when prices are low, and selling or using when prices are high.
Carbon Intensity: Carbon dioxide emissions produced per unit of energy generated or consumed, indicating the environmental impact of energy sources or activities.
Carbon Capture and Storage (CCUS): The capture of carbon dioxide emissions from industrial processes and storing them underground or using them for beneficial purposes.
Direct-Air-Capture (DAC): A technology that captures carbon dioxide directly from the atmosphere (No, it’s not a tree…).
Demand flexibility service: A scheme to incentivise large business energy users to reduce electricity demand during peak times.
Energy Sources & Types
Green Energy: Energy in the form of heat or electricity that is renewable 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.
Fossil Fuels: Fossil fuels are liquid or gaseous hydrocarbons formed underground over millions of years from buried organic matter subject to extreme heat and pressure.
Biomass Energy: Energy in the form of heat, electricity or biofuels 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 moon’s orbit.
Wind Energy: Energy extracted from wind using wind turbines, usually in the form of electricity.
Bladeless Wind Energy: Devices that generate electricity from wind by oscillating due to turbulence instead of rotating blades.
Solar Energy: Energy extracted from solar radiation through the use of photovoltaic panels, usually in the form of electricity or heat.
Floating Solar Energy: Photovoltaic (PV) panels on floating structures placed on bodies of water, such as lakes, reservoirs, or ponds, to generate renewable electricity.
Agrivoltaic Farms: Farms that combine agriculture and solar power by installing solar panels above crops or in herding fields, allowing for dual land use, maximising land productivity and generating another source of income.
Seawater Greenhouses: Sustainable agricultural systems that use seawater for cooling and humidification, allowing plants to grow in arid or desert environments with minimal freshwater usage (which is desalinated using solar power).
Geothermal Energy: Energy extracted from the Earth’s natural heat at depth by utilizing boreholes to extract steam to drive turbines at the surface.
Radioactive-Geothermal: A niche of Geothermal Energy being developed in the UK, in which deep-seated radioactive rocks, instead of hot rocks, heat up water.
Hydropower: A renewable energy source that harnesses the force of moving water to generate electricity.
Run-of-the-river Hydro: A niche of hydropower in which the natural flow of the river isn’t fully disrupted, to generate energy 24/7.
Nuclear Energy: Energy extracted from radioactive materials through the process of nuclear fission.
Thorium Nuclear Energy: Utilises thorium, a naturally occurring, radioactive element, as a fuel in nuclear reactors. It’s considered safer and more abundant than traditional uranium-based nuclear energy.
SMRs and Microreactors: Smaller variations of traditional nuclear power plants. Their small size and modular design allow for flexibility, cost savings, and increased safety measures.
Biogas: Gas produced in an anaerobic digestor from the decomposition of biomass and is similar in composition to natural gas, the fossil fuel.
Off-grid Energy: A system that operates independently of the traditional power grid, utilising self-generated electricity from renewable sources or stored energy.
Energy Storage
Energy Storage: The practice of conserving electricity, hydrogen or heat generated at one time for use at a later time.
Pumped-Storage Hydro (PSH): A type of grid energy storage that uses two water reservoirs at different heights to store and generate power.
Compressed-Air Energy Storage (CAES): Stores energy by compressing air in an underground reservoir for later electricity generation.
Green Hydrogen Storage: Storing hydrogen produced through renewable energy-powered electrolysis in large underground reservoirs for use as a clean energy source when needed.
Flywheels: Devices that store energy kinetically in a spinning mass, which can be converted back to electricity when needed.
Gravitational Batteries: Storage of energy via mechanical systems of pulleys that lift and release a weight across a height difference.
Electric Vehicles (EVs)
EV Charging Stations: Infrastructure that supplies electricity to recharge electric vehicles. This includes slow, home-based chargers and fast, public charging networks.
Energy Contracts & Bills
Business Gas Bill: Covers the cost of gas consumption (only) in commercial premises in the UK, including usage charges, standing charges, VAT, and the Climate Change Levy.
Business 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.
Business electricity prices per kWh: A variable charge paid to business energy suppliers for each unit kWh of electricity consumed at a commercial property as measured by an electricity meter.
Climate Change Levy: A government tax on business energy bills designed to encourage reductions in greenhouse gas emissions.
VAT on business energy: The Value-added tax (VAT) is a consumption tax of 20% levied on business energy bills, with some exceptions for micro businesses.
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: Shows the energy source distribution for the energy provided to your property, to comply with the Fuel Mix Disclosure.
BACS Payment: An electronic system to make payments directly from one bank account to another using a Sort Code and Account Number.
Corporate Power Purchase Agreement (PPA): A contract between a renewable energy generator and an electricity buyer, typically a utility company that is commonly used to support the development of renewable energy projects.
Letter of Authority (LOA): A legal document between a broker and their customer granting the broker permission to act on behalf of a business within specified limits.
Business Energy Contract: A contract for the supply of energy between a business and a supplier. Can be a paper, digital or verbal contract.
Rollover Contract: An automatic renewal of an existing energy contract with the same supplier, often without the customer’s explicit consent, leading to potential price increases or unfavourable terms.
Deemed Contracts: An agreement in which a customer is automatically placed on a default tariff by an energy supplier without a negotiated contract in place.
Small business energy: Microbusiness electricity tariffs offered to companies using less than 1,000kWh monthly electricity (33kWh a day), including a reduced VAT rate.
Business energy tariffs: A contract between a business energy supplier and a company that defines the payment structure of electricity and gas supplied to a commercial property.
Business energy quotes: A proposition of a business energy tariff, including terms and rates, to a prospective company with an electricity or gas supply.
Business energy price cap: A government or regulatory intervention that limits how much business energy suppliers can charge on a variable rate tariff.
Energy Services
Business Energy Audit: An assessment of how and where energy is used in a property. It may be carried on-site, over-the-phone, or internally.
Business Energy Comparison: The evaluation of different business energy suppliers and their offers to find the most suitable and cost-effective option for a business’s energy needs.
Business Gas Comparison: A service to compare the fixed business gas prices being offered by business gas suppliers from across the market.
Business Energy Switching: The process of changing energy suppliers to secure better business electricity rates, terms, or renewable energy options for a business’s energy supply.
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