COP26, Net Zero Gas Pumps and an Energy Glossary

With the upcoming United Nations Climate Change Conference (COP26) taking place by the end of next week and the ongoing natural gas crisis in the UK, the topic of news over the past few days has primarily focused upon the net zero plan to become reliable on sustainable energy by 2050. Solutions to reduce reliability on fossil fuels has incentivised the promotions of green energy, highlighted in the home and building strategy and net zero plan documents published by the government this week.

The promotion of domestic decarbonising heat pumps, as an alternative to traditional gas boilers, was prominent in the home and building plan, highlighted by government backed subsidy of 5k to homeowners wanting to install these heat pumps within the next year. Additionally, plans to expand the electric vehicle (ev) network of charging ports and vehicle production, including a focus on ev public transport, became a large factor to impress foreign diplomats at COP26. The net zero electric grid plan to transition to a renewable national grid by 2035 appears to still be going ahead of the total 2040 net zero plan, with additional investment assisting in this transition. However, the discourse raised alternate voices who criticised that the increase in fossil fuel production before the net zero crossover could drastically affect the climate and that the heat pump campaign doesn’t have enough backing to effectively target a large portion of UK households.

These discussions will only grow across the COP26 conferences, and it is important to know the future of energy, however the energy discourse can often appear unattainable for those outside the energy sector, therefore beneath is an expanded list of energy terms in layman’s terms to further understand the conversation.

Energy Glossary Index

Argus-McCloskey Price Index (API) – The main index for NW European coal.

Amsterdam-Rotterdam-Antwerp (ARA) -The main coal delivery hub for NW Europe

Bacton Balgzand Line (BBL) – The gas interconnector between the UK and the Netherlands.

Balancing – A process of ensuring generation matches demand on a 24/7 basis.

Balancing Mechanism – The process of using Offers and Bids on expensive generator(s)- ensuring demand does not outstrip supply or vice versa in an electricity grid or natural gas pipeline network.

Baseload– The minimum expected customer power requirements at a given time. Baseload power is generally supplied from plants, which cannot be ramped up and down as quickly as peaking generation plants. As baseload demand is generally predictable and steady, it is less expensive than peak power. Power is often traded as baseload to denote a constant quantity of power over a period such as a day.

British Electricity Trading Transmission Arrangements (BETTA) – Sets out the rules of how participants can trade electricity.

Brent – The main global oil index, based on North Sea oil.

Capacity (Electricity) – The rated load-carrying capability of electrical equipment, such as generators or transmission lines, typically expressed in megawatts or megavoltamperes.

Capacity (Gas) – The rated transportation/storage/entry/exit volume of natural gas pipelines and caverns, typically expressed in millions of cubic feet per day.

Carbon Price Floor (CPF) – The UK government-defined minimum price for carbon

Carbon Price Support (CPS) – The UK carbon tax that is the top-up required on the market price of carbon to reach the CPF

Emissions Trading Scheme (ETS) – The EU-wide carbon market

European Union Allowances (EUA) -The units carbon is traded in the ETS – equivalent to 1t of CO2

Grid Code (GC) – Sets out the rules of how the Transmission System (TS) is used by participants/those connected to it.

Interconnector (IUK) -The gas interconnector between the UK and Belgium

Liquefied Natural Gas (LNG) – Gas that has been compressed into a liquid so it can be transported by boat.

National Balancing Point (NBP) -The UK gas hub and the name of the associated index

National Grid Transco (NGT) – Own and operate high-voltage Transmission System (TS)

Organisation of Petroleum Exporting Countries (OPEC) – A global cartel that includes the most of the world’s major oil producing nations.

Therm – The unit of volume gas is typically traded in – equivalent to 29.3KWh or 2.74m3


Additional article reading based on the topics of this blog.

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