Jargon buster

The UK energy industry is a complex one, full of acronyms and jargon that may get confusing. These explanations below should help:

  • CCL: The Climate Change Levy (CCL) is a tax on UK business energy use, charged at the time of supply.
  • CfD: With the closing of the RO scheme, Contracts for Difference (CfD) are long-term contracts to encourage investment in new, low-carbon generation. e-POWER is adapting its auction platform to offer CfD-compatible PPAs for generators to sell their power from January 2015.
  • FIT: The Feed-in Tariff (FIT) scheme is a government subsidy designed to promote smaller scale renewable technologies. It is actually paid via the licensed electricity suppliers, requiring suppliers to make tariff payments on both generation and export of renewable and low carbon electricity. Generators over 30kW who are half-hourly metered can opt out of the government export tariff and get a better market price via the e-POWER auction.
  • LEC: Levy Exemption Certificates (LECs) are issued by Ofgem to generators who produce renewable energy. Suppliers pay generators for their LECs, providing them with the evidence to demonstrate to HMRC that electricity supplied to UK business customers is CCL exempt.
  • PPA: The Power Purchase Agreement (PPA) is a contract between the generator and the supplier that outlines how much generators will be paid for any power they generate that is not used locally but exported to the national grid.
  • REGO: Renewable Energy Guarantees of Origin (REGO) is a certificate issued by Ofgem certifying that the electricity has been produced from renewable energy sources. One REGO is issued for every megawatt hour (MWh) of gross renewable electricity. Once issued, REGOs can be traded with or without the electricity to which it was issued.
  • RO: The Renewables Obligation (RO) provides incentives for large-scale renewable electricity in the UK. It requires licensed UK electricity suppliers to source a specified proportion of the electricity they provide to customers from eligible renewable sources. The RO will close to new generators on 31 March 2017 although electricity generation that is accredited under the RO will continue to receive its full lifetime of support (20 years) until the scheme closes in 2037.
  • ROC: Renewables Obligation Certificates (ROCs) are issued to accredited generators for the eligible renewable electricity they generate. Generators can trade ROCs with other parties or of course buy and sell through the e-ROC auction. ROCs are then ultimately used by energy suppliers to demonstrate that they have met their obligation.

We�re here to help. So if anything is still unclear telephone us on 0191 245 7330 or email e-POWER

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