Definition of Terms Flashcards by C'ZAR KATE MENDEZ

refers to a person or entity, engaged in consolidating electric power demand of
end-users in the contestable market, for the purpose of purchasing and reselling electricity on
a group basis

Aggregator

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refer to those services that are necessary to support the transmission of
capacity and energy from resources to loads while maintaining reliable operation of the
transmission system in accordance with good utility practice and the Grid code to be adopted
in accordance with this Act

Ancillary Services

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refers to the process of issuing direct instructions to electric power
industry participants by the grid operator to achieve the economic operation and maintenance
of quality, stability, reliability and security of the transmission system

Central Dispatch

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refers to a facility which produces electrical an/or mechanical
energy and forms of useful thermal energy such as heat or steam which are used for industrial
commercial heating or cooling purposes through the sequential use of energy

Co-Generation Facility

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refers to electricity end-users who do not have the choice of a supplier of
electricity, as may be determined by the Energy Regulatory Commission (ERC) in accordance
with this Act

Captive Market

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refers to the decision-making body of the ERC composed of a Chairman and
four (4) members as provided under Section 38 hereof

Commission

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refers to the award by the government to a qualified private entity of
the responsibility for financing, operating, expanding, maintaining and managing specific
Government-owned assets

Concession Contract

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refers to the electricity end-users who have a choice of a supplier of
electricity, as may be determined by the ERC in accordance with this Act

Contestable Market

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refers to the component in the retail rate intended for the cost
recovery of customer-related services including, but not limited to, meter reading, billing
administration and collection

Customer Service Charge

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refers to measures undertaken by distribution utilities to
encourage end-users in the proper management of their load to achieve efficiency in the
utilization of fixed infrastructures in the system

Demand Side Management

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refers to the government agency created pursuant to
Republic Act No. 7638 whose expanded functions are provided herein

Department of Energy or DOE

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refers to the government agency created pursuant to
Executive Order No. 127

Department of Finance or DOF

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refers to a compilation of rules and regulations governing electric utilities
in the operation and maintenance of their distribution systems which includes, among others,
the standards for service and performance, and defines and establishes the relationship of the
distribution systems with the facilities or installations of the parties connected thereto

Distribution Code

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refers to the conveyance of electric power by a distribution utility
through its distribution system pursuant to the provisions of this Act

Distribution of Electricity

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refers to the system of wires and associated facilities belonging to a
franchised distribution utility extending between the delivery points on the transmission or
subtransmission system or generator connection and the point of connection to the premises of
the end-user

Distribution System

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refers to the cost or charge regulated by the ERC for the use
of a distribution system and/or the availment of related services

Distribution Wheeling Charge

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refers to any electric cooperative, private corporation, governmentowned utility or existing local government unit which has an exclusive franchise to operate a
distribution system in accordance with this Act

Distribution Utility

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refers to a distribution utility organized pursuant to Presidential Decree
No. 269, as amended, or as otherwise provided in this Act

Electric cooperative

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refers to any person or entity engaged in the generation,
transmission, distribution or supply of electricity

Electric Power Industry Participant

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refers to any person or entity requiring the supply and delivery of electricity for its
own use

End-user

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refers to the independent, quasi-judicial regulatory
body created under Executive Order No. 172, as amended

Energy Regulatory Board or ERB

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refers to the regulatory agency created herein

Energy Regulatory Commission or ERC

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refers to a geographical area exclusively assigned or granted to a
distribution utility for distribution of electricity

Franchise Area

refers to any person or entity authorized by the ERC to operate
facilities used in the generation of electricity

Generation Company

refers to the production of electricity by a generation company or a co-generation facility pursuant to the provisions of this Act

Generation of Electricity

refers to the high voltage backbone system of interconnected transmission lines, substations and related facilities

Grid

refers to the set of rules and regulations governing the safe and reliable operation, maintenance and development of the high voltage backbone transmission system and its related facilities

Grid Code

refers to an existing power generating entity which is not owned by NPC

Independent Power Producer or IPP

refers to an amount charged by distribution utilities to industrial and commercial end-users as well as to other subsidizing customer sectors in order to reduce electricity rates of other customer sectors such as the residential end-users, hospitals, and streetlights

Inter-Class Cross Subsidy

refers to an amount embedded in the electricity rates of NPC charged to its customers located in a viable regional grid in order to reduce the electricity rates in a less viable regional grid

Inter-Regional Grid Cross Subsidy

refers to an amount embedded in the electricity rates of NPC charged to distribution utilities and non-utilities with higher load factor and/or delivery voltage in order to reduce the electricity rates charged to distribution utilities with lower load factor and/or delivery voltage located in the same regional grid

Intra- Regional Grid Cross Subsidy

refers to qualified independent entities appointed by PSALM Corporation who shall administer, conserve and manage the contracted energy output of NPC IPP contracts

IPP Administrator

refers to the backbone system of wires and associated facilities not directly connected to the national transmission system

Isolated Distribution System

refers to the subsidized rate given to low-income captive market end-users who cannot afford to pay at full cost

Lifeline Rate

refers to the government agency created under Presidential Decree No. 269, as amended, and whose additional mandate is further set forth herein

National Electrification Administration or NEA

refers to the government corporation created under Republic Act No. 6395, as amended

National Power Corporation or NPC

refers to the corporation organized pursuant to this Act to acquire all the transmission assets of the NPC

National Transmission Corporation or TRANSCO

refers to the system of allowing any qualified person the use of transmission, and/or distribution system, and associated facilities subject to the payment of transmission and/or distribution retail wheeling rates duly approved by the ERC

Open Access

refers to the overall energy program formulated and updated yearly by the DOE and submitted to Congress pursuant to Republic Act No. 7638

Philippine Energy Plan or PEP

refers to the indicative plan for managing electricity demand through energy-efficient programs and for the upgrading, expansion, rehabilitation, repair and maintenance of power generation and transmission facilities, formulated and updated yearly by the DOE in coordination with the generation, transmission and distribution utility companies

Power Development Program or PDP

refers to the corporation created pursuant to Section 49 hereof

Power Sector Assets and Liabilities Management Corporation or PSALM Corp.

refers to the sale, disposition, change and transfer of ownership and control of assets and IPP contracts from the Government or a government corporation to a private person or entity

Privatization

refers to energy resources that do not have an upper limit on the total quantity to be used. Such resources are renewable on a regular basis and the renewable rate is rapid enough to consider availability over an indefinite time. These include, among others, biomass, solar, wind, hydro and ocean energy

Renewable Energy Resources

refers to the process of reorganizing the electric power industry in order to introduce higher efficiency, greater innovation and end-user choice. It shall be understood as covering a range of alternatives enhancing exposure of the industry to competitive market forces

Restructuring

refers to the total price paid by end-users consisting of the charges for generation, transmission and related ancillary services, distribution, supply and other related charges for electric service

Retail Rate

refers to the functional unit of NPC created to pursue missionary electrification function

Small Power Utilities Group or SPUG

refer to the excess of the contracted cost of electricity under eligible contracts over the actual selling price of the contracted energy output of such contracts in the market. Such contracts shall have been approved by the ERB as of December 31, 2000

Stranded contract costs of NPC or distribution utility

refer to any unpaid financial obligations of NPC which have not been liquidated by the proceeds from the sales and privatization of NPC assets

Stranded Debts of NPC

refer to the facilities related to the power delivery service below the transmission voltages and based on the functional assignment of assets including, but not limited to step-down transformers used solely by load customers, associated switchyard/substation, control and protective equipment, reactive compensation equipment to improve customer power factor, overhead lines, and the land such facilities/ equipment are located. These include NPC assets linking the transmission system and the distribution system which are neither classified as generation nor transmission

Subtransmission Assets

refers to any person or entity authorized by the ERC to sell, broker, market or aggregate electricity to the end-users

Supplier

refers to the charge imposed by electricity suppliers for the sale of electricity to end-users, excluding the charges for generation, transmission and distribution wheeling

Supplier’s Charge

means the sale of electricity by a party other than a generator or a distributor in the franchise area of a distribution utility using the wires of the distribution utility concerned

Supply of Electricity

refers to the regulated cost or charges for the use of a transmission system which may include the availment of ancillary services

Transmission Charge

refers to the program for managing the transmission system through efficient planning for the expansion, upgrading, rehabilitation, repair and maintenance, to be formulated by DOE and implemented by the TRANSCO pursuant to this Act

Transmission Development Plan or TDP

refers to the conveyance of electricity through the high voltage backbone system

Transmission of Electricity

refers to the charge, if any, imposed for the recovery of the stranded cost and other purposed pursuant to Section 34 hereof

Universal Charge