Glossary of Terms

• BACKHAUL: A transaction where gas is transported the opposite direction of normal flow on a unidirectional pipeline.
• BASE LOAD: A given demand for natural gas that remains fairly constant over a period of time, usually not temperature sensitive.
• BASIS DIFFERENTIAL: The difference in price between any two natural gas pricing points or time periods. One of the more common references to basis differential is the pricing difference between Henry Hub and any other pricing point in the continent.
• BRITISH THERMAL UNIT (BTU): The amount of heat required to raise the temperature of one pound of pure water one degree Fahrenheit under stated conditions of pressure and temperature; a therm (see below) of natural gas has an energy value of 100,000 BTUs and is approximately equivalent to 100 cubic feet of natural gas.
• CITY GATE: The point at which natural gas deliveries transfer from the interstate pipelines to a natural gas utility’s distribution system.
• COMPRESSION: Increasing the pressure of natural gas in a pipeline by means of a mechanically driven compressor station to increase flow capacity.
• CUBIC FOOT (CF): A measure of natural gas required to fill a volume of one cubic foot under stated conditions of temperature, pressure and water vapor; one cubic foot of natural gas has the energy value of approximately 1,000 BTUs and 100 cubic feet of natural gas equates to one therm (see below).
• DEKATHERM: Unit of measurement for natural gas; a dekatherm is 10 therms, which is one thousand cubic feet (volume) or one million BTUs (energy).
• DEMAND-SIDE MANAGEMENT (DSM): The activity pursued by an energy utility to influence its customers to reduce their energy consumption or change their patterns of energy use away from peak consumption periods.
• DEMAND-SIDE RESOURCES: Energy resources obtained through assisting customers to reduce their “demand” or use of natural gas. Also represents the aggregate energy savings attained from installation of conservation measures.
• DTH: Unit of measurement for natural gas; a dekatherm is 10 therms, which is one thousand cubic feet (volume) or one million BTUs (energy).
• FEDERAL ENERGY REGULATORY COMMISSION (FERC): The government agency charged with the regulation and oversight of interstate natural gas pipelines, wholesale electric rates and hydroelectric licensing; the FERC regulates the interstate pipelines with which Avista does business and determines rates charged in interstate transactions.
• FIRM SERVICE: Service offered to customers under schedules or contracts that anticipate no interruptions; the highest quality of service offered to customers.
• FORCE MAJEURE: An unexpected event or occurrence not within the control of the parties to a contract, which alters the application of the terms of a contract; sometimes referred to as “an act of God;” examples include severe weather, war, strikes, pipeline failure and other similar events.
• FORWARD PRICE: The future price for a quantity of natural gas to be delivered at a specified time.
• HEATING DEGREE DAY (HDD): A measure of the coldness of the weather experienced, based on the extent to which the daily average temperature falls below 65 degrees Fahrenheit; a daily average temperature represents the sum of the high and low readings divided by two.
• HENRY HUB: The physical location found in Louisiana that is widely recognized as the most important pricing point in the United States. It is also the trading hub for the New York Mercantile Exchange (NYMEX).
• INJECTION: The process of putting natural gas into a storage facility; also called liquefaction when the storage facility is a liquefied natural gas plant.
• JACKSON PRAIRIE: An underground storage project jointly owned by Avista Corp., Puget Sound Energy, and Williams Northwest Pipeline. The project is a naturally occurring aquifer near Chehalis, Washington, located some 1,800 feet beneath the surface and capped with a very thick layer of dense shale.
• LIQUEFACTION: Any process in which natural gas is converted from the gaseous to the liquid state; for natural gas, this process is accomplished through lowering the temperature of the natural gas.
• LIQUEFIED NATURAL GAS (LNG): Natural gas that has been liquefied by reducing its temperature to minus 260 degrees Fahrenheit at atmospheric pressure.
• LOCAL DISTRIBUTION COMPANY (LDC): A utility that purchases natural gas for resale to end-use customers and/or delivers customer’s natural gas or electricity to end users’ facilities.
• LOOPING: The construction of a second pipeline parallel to an existing pipeline over the whole or any part of its length, thus increasing the capacity of that section of the system.
• MCF: A unit of volume equal to a thousand cubic feet.
• MMBTU: A unit of heat equal to one million British thermal units (BTUs) or 10 therms. Can be used interchangeably with Dth.
• NATURAL GAS: A naturally occurring mixture of hydrocarbon and non-hydrocarbon gases found in porous geologic formations beneath the earth’s surface, often in association with petroleum; the principal constituent is methane, and it is lighter than air.
• NEW YORK MERCANTILE EXCHANGE (NYMEX): An organization that facilitates the trading of several commodities including natural gas.
• PEAK DAY: The greatest total natural gas demand forecasted in a 24-hour period used as a basis for planning peak capacity requirements.
• PEAKING CAPACITY: The capability of facilities or equipment normally used to supply incremental natural gas under extreme demand conditions (i.e. peaks); generally available for a limited number of days at this maximum rate.
• SERVICE AREA: Territory in which a utility system is required or has the right to provide natural gas service to ultimate customers.
• SPOT MARKET GAS: Natural gas purchased under short-term agreements as available on the open market; prices are set by market pressure of supply and demand.
• STORAGE: The utilization of facilities for storing natural gas which has been transferred from its original location for the purposes of serving peak loads, load balancing and the optimization of basis differentials; the facilities are usually natural geological reservoirs such as depleted oil or natural gas fields or water-bearing sands sealed on the top by an impermeable cap rock; the facilities may be man-made or natural caverns. LNG storage facilities generally utilize above ground insulated tanks.
• THERM: A unit of heating value used with natural gas that is equivalent to 100,000 British thermal units (BTU); also approximately equivalent to 100 cubic feet of natural gas.
• VAPORIZATION: Any process in which natural gas is converted from the liquid to the gaseous state.
• WITHDRAWAL: The process of removing natural gas from a storage facility, making it available for delivery into the connected pipelines; vaporization is necessary to make withdrawals from an LNG plant.

Author: Admin
Published: May 16, 2012
Last Updated: June 23, 2012