Energy transition explained

A company that buys energy in the wholesale market and sells it on to customers. They are often called energy retailers. They can be independent, standalone businesses or be part of a large integrated utility company. 

This is a term that refers to something that delivers energy where it is needed. For example, fossil fuels like oil and gas are energy vectors in the sense they are energy rich and make this energy available at the location and time the energy is required. The same is true of electricity and hydrogen. Having a mix of energy vectors in an energy system provides resilience both in terms of security of supply and unexpected system failures. 

Charges paid by electricity consumers to finance the costs of building and operating the electricity grid. The network tariffs are usually set by a national regulator as the TSO/DSO/DNO operating the grid has a natural monopoly.

A NMF is a transparent, neutral market for the trading of distributed flexibility and enables buyers and sellers of flexibility to register their requirements and capabilities. The scale of a NMF can range from nationwide to multiple platforms linked to specific network boundaries.

A term used to characterise where the energy transition is taking us. The ‘old energy’ world is one characterised by high carbon energy, a centralised energy system, a focus on commodities and assets. The ‘new energy’ world that is emerging as a result of the energy transition is one that is characterised by low carbon / renewable energy, a distributed and multi-directional energy system, a focus on services and customers. The customer is at the heart of the new energy world which was never the case in the old energy world because the way energy is used has to change, and therefore new customer technologies and propositions are required.

A term mainly used in the UK, referring to a company licensed to own and operate electricity networks in a small local area. It has similar responsibilities to a DNO for its own network, but the regulatory requirements differ to a DNO.

Electricity and gas interconnectors are the physical links which allow the transfer of electricity or gas from one country to another. 

A heat engine in which the combustion of a fuel occurs with an oxidizer in a combustion chamber that is an integral part of the working fluid flow circuit.

Refers to the day when the energy is delivered. Generally used in the context of electricity spot markets.

These are electronic devices that can turn DC (Direct Current) to AC (Alternating Current). They are required to connect solar plants or wind farms to the electricity grid (i.e. the renewable electricity is DC while the grid is AC). Electric batteries also require an inverter for connecting to the grid – in a home, a rooftop PV system with a home battery can all be connected through a single integrated inverter. A rectifier performs the opposite function, to convert AC to DC.

The process of offering shares of a private corporation to the public in a new stock issuance. It is commonly used as an exit route for investors who have funded a successful start-up. 

A local part of the network that can be operated independently of the national grid.