A GLOSSARY OF COMMONLY USED PUBLIC POWER TERMS
load factor
kilowatt
kilowatt
As the electric industry evolves, more acronyms
and new terms appear each day. We created this
glossary to help limit confusion and help decision-
makers sift through the technical terms.
This glossary is designed specifically for use by
government ocials, economic developers, and
Power Agency members who own and operate
electric systems in North Carolina. It is meant to
be a translation aid; it is not scientifically absolute
nor legally precise.
If you have any suggestions, please contact:
Michelle Vaught at mv[email protected]
or Shane Poteete at s[email protected].
NCEMPA
NCMPA1
A
acid rain
Precipitation containing harmful amounts of nitric and sulfuric acids created by the chemical reaction of sulfur
oxides and nitrogen oxides with water vapor in the atmosphere. Acid rain is produced mainly by the combustion
of fossil fuels in power plants, industrial boilers, private homes and automobiles.
administrative and general (A&G)
Used in accounting to describe expenses.
advanced metering infrastructure (AMI)
An integrated system of smart meters, communications networks and data management systems that enables
two-way communication between utilities and customers.
all-requirements customer
A municipality that purchases all of its electrical power from a single supplier, such as a Power Agency.
allowance for funds used during construction (AFUDC)
Allows a utility to earn a return on costs that were prudently incurred during the construction of major facilities.
American National Standards Institute (ANSI)
A private nonprot organization that oversees the development of voluntary consensus standards for products,
services, processes, systems and personnel in the U.S.
American Public Power Association (APPA)
A national trade association whose membership includes a majority of the country’s more than 2,000 publicly
owned electric utility systems. e association dropped the APPA acronym in early 2017.
American Society of Mechanical Engineers (ASME)
A not-for-prot professional membership organization founded in 1880 that enables collaboration, knowledge
sharing, career enrichment, and skills development across all engineering disciplines.
ampere
e unit of electrical current or ow.
acid rain
ampere
Atomic Energy Commission (AEC)
Federal agency created in 1946 to manage the development, use and control of atomic (nuclear) energy for
military and civilian applications. e AEC was subsequently abolished by the Energy Reorganization Act of
1974 and succeeded by the Energy Research and Development Administration and the U.S. Nuclear Regulatory
Commission.
Atomic Safety and Licensing Board Panel (ASLBP)
e independent trial-level adjudicatory body of the U.S. Nuclear Regulatory Commission.
availability
e percent of time that a generating unit is available to provide power.
B
Balance of Plant (BOP)
e remainder of a power plant’s infrastructure that supports major components such as boilers, turbines
and generators.
base load plant
A plant that is normally operated to take all or part of the minimum load of a system, which consequently
produces electricity at an essentially constant rate and runs continuously. Nuclear plants are examples of base
load plants.
basis point
A measure of nancial interest where 100 basis points equals 1 percent of interest.
bearer bonds
Bonds that do not have the owner’s name registered on the books of the issuer and whose proceeds (both
principal and interest) are payable to the holder, or bearer. (See registered bonds.)
billing determinants
Factors such as kilowatt-hours used or kilowatts of demand incurred during the billing period. ese factors are
multiplied by the applicable electric rate to calculate a bill.
billing period
e period of time, typically one calendar month, in which a customer is billed for electrical usage.
Atomic Energy Commission (AEC)
billing period
Board of Commissioners (BOC)
A decision-making board for each Power Agency. Each Power Agency Participant appoints a Commissioner
and up to two Alternate Commissioners to the Board of Commissioners. e Board of Commissioners monitors
operations of the Power Agency, approves the annual budget and elects representatives to the ElectriCities Board
of Directors.
Board of Directors (BOD)
e ElectriCities Board of Directors provides oversight of NCMPA1 and NCEMPA operations. e Board meets
monthly and consists of 14 elected members and two appointed (ex-ocio) members (the Chairs of each Power
Agency Board of Commissioners). e elected board members serve three-year terms.
boiler
A large, closed container in which water is heated as it passes through a series of tubes and is turned into steam
that can be used to drive a turbine and an electric generator.
boiling water reactor (BWR)
A type of light water nuclear reactor used to generate electrical power.
bond
A piece of paper signifying that the issuer of the bond borrowed money from the bondholder (“creditor”).
A bond states the terms of the debt, including how long before the debt must be repaid and how much interest
will be paid in the meantime. A stock, unlike a bond, is a receipt for property. Owners of stock share in prots
and losses, but creditors get paid before owners get anything. erefore, bonds are called
“senior securities.”
bond anticipation notes (BANs)
Notes issued for a short period of time (usually three years) to obtain needed money for a Power Agency.
Because the notes have shorter maturities, they have signicantly lower interest rates than long-term debt.
bond resolution
e formal document that is approved by a Power Agency’s Board of Commissioners to govern the issuance of
bonds and the use of the proceeds thereof.
British Thermal Unit (Btu)
e amount of heat required to increase the temperature of a pound of water by one degree Fahrenheit,
sometimes characterized as the amount of heat given o during the burning of an old-style wood kitchen match.
Board of Commissioners (BOC)
British Thermal Unit (Btu)
Bulk Power Marketing (BPM)
Purchases and sales of electricity between resellers, such as utilities, in the local and regional power markets.
bus (or bus bar)
An electrical connection, usually in the form of aluminum or copper bars, that allows for multiple circuits to be
tied to a common point.
C
capability
e maximum electrical output that a generating unit can provide for a specic time period without exceeding
its operational limits.
capacity
e ratings given by the manufacturer or the user to a generating unit, a generation plant, a transformer or
other piece of equipment. A nameplate rating is the manufacturer’s rating and is usually shown on a nameplate
attached to the equipment. Capacity is also the ability to produce a given amount of power at an instant in time,
measured in kilowatts or megawatts.
capacity factor
e actual power generated over a period of time by a generating unit divided by the maximum power that could
have been generated had the unit run at full capacity. A high capacity factor (90 to 100 percent) indicates that a
unit has run at or near full capacity.
capitalized interest
Interest on bonds that is paid from the issuance of those bonds.
Catawba Nuclear Station
A two-unit pressurized water reactor (PWR) nuclear plant located in York County, South Carolina, and operated
by Duke Energy Carolinas. NCMPA1 owns 75 percent of Unit 2.
chain reaction
A self-sustaining series of events in a nuclear reactor in which a neutron (a subatomic particle) splits an atom,
releasing sucient neutrons to cause many other atoms to split in the same way, which in turn split more
atoms, etc.
Bulk Power Marketing (BPM)
chain reaction
cogeneration
e dual production of electricity and another form of useful thermal energy (such as heat or steam) for use in
commercial/industrial heating or cooling processes.
coincident peak
e demand of a Power Agency, or a city, measured in kilowatts or megawatts, that occurs at the same time as
the peak demand of the entity that is supplying the power.
combustion turbine
A jet engine-like turbine used in generating facilities designed for fast start up and used specically for peaking
capacity. Combustion turbines use natural gas or oil for fuel.
commercial operation
e point at which the owner of a generating unit that has been under construction declares it to be operational
and capable of fullling its legal and regulatory obligations.
commercial paper
Promissory notes, typically with maturities of 60 days or less and in denominations of at least $100,000. e
buyers of commercial paper are almost exclusively institutions, such as money market funds, pension funds and
bank trust departments.
condenser
A large piece of equipment that uses water or air to cool the steam exhausted from a turbine so that it can be
returned to the system as water.
construction work in progress (CWIP)
is involves the construction of new utility facilities and the means to fund them until construction is complete.
If recovery of the cost of CWIP is allowed, a utility can immediately begin receiving reimbursement for its
expenses from its customers and begin earning a return on its investment without going through a formal rate-
making process to determine if the costs were prudently incurred.
containment building
e building that houses a nuclear reactor and is designed to contain any radioactive solids, gases or water so as
to prevent their release into the environment.
control rod
A rod, plate or tube used to control or halt the chain reaction in a nuclear reactor by absorbing the neutrons that
sustain the chain reaction.
cogeneration
control rod
control room
Operation center of a power plant.
coolant
e uid, usually water, that is circulated throughout a condenser or nuclear reactor to transfer heat.
cooling tower
A very large structure that cools water from the condenser of a power plant through evaporation as it circulates
within a moving stream of air.
cooperatives or co-ops
Customer-owned electric membership corporations (EMCs) that originated in the 1930s to bring electric service
to remote and rural areas. Since 1965, the North Carolina co-ops have been private corporations. Municipal
systems compete with co-ops and with private power companies for new customers and territory. Co-ops are
sometimes called REAs, because they were authorized by the federal Rural Electrication Act.
core
e central part of a nuclear reactor. It contains the fuel and produces the heat needed to generate electricity.
coupon bonds
Bonds to which coupons are attached for each interest payment. e coupons are cut o as they come due
(usually semiannually) and are presented to a Power Agency, or its agent, for payment.
critical
e term used to describe a nuclear reactor that is sustaining a chain reaction.
D
decommissioning
e process of closing down a nuclear facility and reducing the residual radioactivity to a level that permits the
release of the property and termination of the operating license. Nuclear power plants are required by the NRC
to set aside funds during operation to cover their eventual decommissioning costs. (See NRC.)
default
Failure to honor contractual obligations, such as the failure or refusal of the issuer of bonded debt to pay the
principal or interest when due, or failure to fulll other agreed-to covenants.
control room
default
delivery point
A point at which the power supplier delivers power to a participating municipality’s distribution system.
demand
Every electric system has a demand, or load. Expressed in kilowatts or megawatts, demand is a measure of
the rate at which electric energy is delivered to, or by, a system. e primary source of demand is the power-
consuming equipment of the system’s customers. Demand usually varies from minute to minute, hour to hour,
day to day, and season to season.
demand charge
Electric rates paid by large customers usually include two charges: demand and energy. e demand charge is
based on the customer’s maximum demand on the system and is associated with the xed components, such as the
monthly mortgage payments on a power plant, of the supplier’s cost to provide electric service. (See ratchet.)
demand-side management (DSM)
Actions in which a customer’s energy usage and/or demand are curtailed or modied to achieve certain goals
intended to benet both the customer and the power supplier. For example, a customer’s electric rate may be
reduced in return for allowing the power supplier to turn o the customer’s air conditioner for limited periods
during a hot summer aernoon, enabling the power supplier to avoid operating very expensive generating units.
Department of Energy (DOE)
A government department whose mission is to advance energy technology and promote related innovation in
the U.S.
distributed generation (DG)
e generation of energy by a variety of small, grid-connected devices or sources, such as small hydro, biomass,
or solar, wind, or geothermal power. DG includes relatively small (2,000 kW or less) electric generators used
to reduce a customer’s peak demands and/or provide greater reliability, typically internal combustion engines
operating on diesel fuel and located at customer-owned facilities.
distribution facilities
e relatively lower voltage system (typically less than 15,000 volts) of transformers, power lines, poles and
meters that brings electricity from the higher voltage transmission system and reduces it further to a level that
can be used by customers.
delivery point
distribution facilities
E
Edison Electric Institute (EEI)
An association of electric companies acting as an information exchange for its members and a public relations
voice for the investor-owned electric industry (See IOUs).
electric energy
Electric energy can’t be seen or heard. It is created by electric generators and converted by customers into other
forms of energy, such as light, heat or motion. e amount of electric energy used by customers is typically
measured in kilowatt-hours, while the bulk power market measures usage in megawatt-hours.
electric revenue bonds
Bonds secured by revenues from the operation of a publicly owned electric system. Typically, revenue bonds
have no claim on the borrower’s taxing authority. General obligation bonds (g.o. bonds) are bonds backed by
a city’s taxing power and credit and, because of that added security, generally carry lower interest rates than
revenue bonds.
electromagnetic elds (EMFs)
Fields produced by alternating current electric power. e elds are invisible lines of force that occur wherever
electricity is being conducted. Some people claim that EMFs have harmful health eects. As of this printing,
there is no conclusive evidence to support that claim.
emergency core cooling system
A series of backup safety systems designed to dump thousands of gallons of water into a nuclear reactor in the
event that the normal core cooling system fails.
emergency feedwater pumps
Backup pumps designed to supply water to steam generators (boilers) if the normal feedwater system should fail.
Also called auxiliary feedwater pumps.
energy charge
Usually included in electric rates; reects the amount of kilowatt-hours a customer uses and typically represents
the variable components of the supplier’s cost to provide electric service, such as fuel.
Edison Electric Institute (EEI)
energy charge
enriched fuel
Uranium that has been modied for use in nuclear power plants by increasing the concentration of uranium-235
to a level that will better sustain a chain reaction. (See chain reaction.)
entitlement
e specied percentage of the output and services of a generating unit to which a Power Agency (oen because
of its ownership interest) and its participating municipalities are entitled under contract.
Environmental Protection Agency (EPA)
e federal agency that can require environmental impact statements and reports.
Electric Power Research Institute (EPRI)
An independent, nonprot center for electricity and environmental research.
F
Federal Energy Regulatory Commission (FERC)
A quasi-independent regulatory agency within the Department of Energy with jurisdiction over interstate
electricity sales, wholesale electric rates, hydroelectric licensing, natural gas pricing, oil pipeline rates and gas
pipeline certication.
forced outage rate (FOR)
e percentage of hours during a year in which a generating unit is unable to operate due to
unplanned circumstances.
fossil fuel
Fossil fuels, such as coal, oil and natural gas, originate from organic matter. ey are also called
conventional fuels.
fuel assembly
A cluster of fuel rods. Groups of fuel assemblies make up a nuclear reactor core.
fuel clause
A utility’s rates are set to recover various costs: debt payments, fuel costs, administrative expenses and so on.
Of these, fuel costs are the most variable and can change markedly from month to month. Regular rates include
an amount for basic fuel expenses. A fuel clause is an adjustable rate factor that rises or falls with increases or
decreases in the price of fuel consumed during a given period.
enriched fuel
fuel clause
fuel expense
e cost of the fuel that is used to generate electricity.
fuel pool
A large pool containing water in which spent nuclear fuel is stored.
fuel rod
A long, slender, hollow rod containing pellets of enriched uranium for use as fuel in a nuclear reactor. Fuel
rods are assembled into bundles called fuel elements or fuel assemblies, which are loaded individually into the
reactor core.
G
general emergency
A state of emergency declared by a utility when an incident at a nuclear power plant poses a potentially serious
threat that radiation could be released beyond the immediate area of the plant. (See site emergency.)
generation and transmission (G&T)
Usually refers to an electric cooperative whose business is limited to the generation and transmission of
electricity for use by other cooperatives.
generation mix
A term used to describe the types of electrical generation a utility uses or presently has on-line (coal, nuclear,
hydro, etc.).
generator
A machine that converts mechanical energy into electricity through the use of magnets and wire coils rotating
at high speeds.
geothermal energy
Power generated from natural steam, hot water, hot rocks, or lava in the Earth’s crust. In general, geothermal
power is produced by pumping water into cracks in the Earth’s crust and then conveying the heated water or
steam back to the surface so that its heat can be extracted through a heat exchanger, where its pressure can be
used to drive turbines.
fuel expense
geothermal energy
gigawatt
One billion watts or one million kilowatts or one thousand megawatts.
green energy
A generic term for any type of energy that is considered to have a lower environmental eect than fossil fuel-
produced energy. e term is relative and is subject to diering denitions and interpretations. It is generally
interchangeable with “renewable energy.”
greenhouse effect
e increase in the earth’s surface temperature caused by greenhouse gases in the atmosphere. e
greenhouse eect allows solar radiation to penetrate the atmosphere but prevents the associated heat from
returning to space.
greenhouse gases
Gases such as methane and carbon dioxide whose release into the environment contribute to the greenhouse eect.
grid
e system comprised of generators, transmission lines and distribution components that provides for the
production and delivery of electricity within a region.
H
hazardous waste
Various toxic, radioactive, ammable or corrosive materials produced by industries, agriculture, research and
other sources.
high-pressure injection
A system capable of pumping as much as 1,000 gallons a minute into a nuclear reactor coolant system at very
high pressure. is is part of the emergency core cooling system.
hydroelectric plant
A facility that uses the force of falling water to turn turbine blades and spin generators to produce electricity.
gigawatt
hydroelectric plant
I
independent power producer (IPP)
An entity that owns, builds and operates electric generators for selling electricity in the bulk power market, but
does not directly serve end-use electric customers and is not an electric utility.
independent system operator (ISO)
An entity that manages the operations of the transmission systems of multiple utilities as one interconnected
system, but is not controlled by the utilities.
infrared scanning
A process that determines the temperature of any object by measuring the amount of invisible infrared radiation
emitted by the object. In the power industry, hand-held infrared scanners are used to detect “hot spots” in
equipment such as transformers and generators that may signal a problem with the equipment. Infrared
scanning is also used to determine the eectiveness of the insulation in a house by detecting areas of heat loss in
winter or heat gain in summer.
Institute of Nuclear Power Operations (INPO)
An industry association that promotes excellence in the operation of nuclear electric generating plants.
interchange agreement
An agreement that includes a variety of services that utilities provide each other to increase reliability and
eciency and to avoid duplicating expenses. For example, with an emergency service agreement, one utility
commits to furnish another with power in times of emergencies. Another example: With an economic exchange
agreement, utilities agree to buy power from each other in order to avoid operating their own more expensive
plants.
interconnection agreement
An agreement between two utilities to connect their transmission and generation systems in order to, for
example, implement interchange agreements. Under an interconnection agreement between NCMPA1 and Duke
Energy Carolinas, agency-owned power ows from the generating units to the participating municipalities’
distribution systems.
independent power producer (IPP)
interconnection agreement
interruptible power
Deliveries of electric energy and/or capacity that can be reduced, or curtailed altogether, at the discretion of the
power supplier and with the prior agreement of the customer. e customer benets by paying a lower electric
rate, and the supplier is better able to manage its portfolio of resources and obligations.
investor-owned utilities (IOU)
Power companies such as Duke Energy Carolinas and Dominion Power that are owned by shareholders and
sometimes referred to as “private power companies.”
J
joint action agency
An entity composed of two or more public power utilities that join together to own generation (and/or
transmission) facilities, or parts of such facilities, in order to attain power costs that are lower than what could
have been realized had they acted individually.
K
kilovolt-ampere (kVA)
1,000 volt-amperes. A measure of the amount of electric power, including its associated ineciencies, that a
piece of equipment is capable of accommodating. e nameplate ratings of generators and transformers are
given in kVA.
kilowatt (kW)
1,000 watts. A measure of the amount of electric power generated and the rate at which it is used. By comparison,
if a kilowatt-hour is equivalent to the number of miles a car travels, a kilowatt is equivalent to the speed at which
the car traveled.
kilowatt-hour (kWh)
A measure of the use of electric energy. One kilowatt-hour is the amount of electricity required to operate a 100-
watt light bulb for 10 hours or 10 100-watt light bulbs for one hour.
interruptible power
kilowatt-hour (kWh)
L
lead manager
e senior rm of the group of investment bankers that forms the syndicate for underwriting a bond issue. (See
managing underwriters.) e lead manager, or senior manager, “runs the books” on the issue, meaning he or she
is administratively in charge of the marketing, allocation, payment and delivery of the bonds. e lead manager
deals directly with a Power Agency, various counsel and consultants, and the other members of the syndicate. He
or she oversees document preparation, printing, and mailing, and receives a larger portion of the management
fee and, with the other managers, a larger share of the bonds for resale.
leased facilities fee (or leased facilities charge)
A fee that a utility pays to the owner of a transmission system for the use of facilities, such as delivery points, that
are not included in the transmission owner’s wheeling fee.
line loss
Electrical energy lost in the process of distributing it over power lines.
load
See demand.
load curve
A line on a graph used to show how the use of electric power (demand) rises and falls during a given period of time.
load factor
e ratio of average demand to peak demand. It reveals whether a system’s electrical usage is reasonably stable or
has extreme peaks and valleys. A high load factor is better than a low load factor because the demand charge is
distributed over more kilowatt-hours and reduces the average cost of power.
load forecast
A projection of a system’s future electrical requirements.
load management program
A program through which a utility seeks to control its customers’ use of electricity (or loads) so as to reduce the
system’s total demand at a time of maximum (peak) usage. Load management can include such techniques as
voltage reduction, remote control of air conditioners and water heaters, shiing the time in which a city pumps
water and rotating blackouts.
lead manager
load management program
load-side generation
Relatively small electric generators that are located on the customer’s premises and connected directly to the
customer’s internal electric lines.
M
managing underwriters
A group, or “syndicate,” of banking rms selected by a Power Agency’s Board of Commissioners to head up the
sale of an agency bond issue or issues. ese rms agree to underwrite (guarantee the purchase of) a large block
of the bonds and assemble a much broader group of banking rms to buy the rest of the issue. e bonds are
then resold by the investment banking rms to corporate and individual investors. (See lead manager.)
maximum net dependable capacity (MNDC)
e output that can be expected from a generating unit—net of any parasitic equipment such as pumps—when it
is operating at full capacity. MNDC can vary depending on operating conditions.
McGuire Nuclear Station
A two-unit pressurized water reactor (PWR) nuclear plant located in Mecklenburg County and operated by
Duke Energy Carolinas.
megawatt (MW)
One million watts or one thousand kilowatts.
metering period
e time period (about one month) during which electric usage is recorded at a meter point. is does not
always coincide with the billing period since meters are not read on the last day of the calendar month if that day
falls on a weekend or holiday.
N
net interest cost (NIC)
One of the two most common measures of interest rates for new bond issues. (See true interest cost.) Net interest
cost is a measure of simple interest that takes into account the total amount of interest to be paid over the length
of a loan, as well as any premium or discount by the underwriters.
load-side generation
net interest cost (NIC)
NIMBY
An acronym for “not in my back yard,” used to describe the attitude of people or entities who do not want any
electric industry facilities (power plants, transmission lines, waste repositories, etc.) built on, near or within sight
of their property or town.
non-coincident peak
A Power Agency’s, or individual municipality’s, peak demand at whatever time it occurs, without relationship to
the peak of the associated power supplier.
non-Power Agency member
A member of ElectriCities that is not a member of a Power Agency. ese members have wholesale contracts
with investor-owned utilities and are members of ElectriCities for trade-association services.
North American Electric Reliability Corporation (NERC)
e organization certied by FERC to establish and enforce reliability standards for the bulk power system (i.e.,
transmission and large generation facilities).
North Carolina Association of Municipal Electric Systems (NCAMES)
A nonprot association and an aliate of the N.C. League of Municipalities that exists to promote the interest
and welfare of municipal electric systems in North Carolina. NCAMES hosts the annual lineman’s rodeo
competition.
North Carolina Eastern Municipal Power Agency (NCEMPA)
Power Agency comprised of 32 municipalities in eastern North Carolina. Also referred to as Eastern Agency.
North Carolina Municipal Power Agency Number 1 (NCMPA1)
Power Agency comprised of 19 municipalities in the piedmont and western part of the state. Also referred to as
Agency 1.
NIMBY
North Carolina Municipal Power Agency Number 1 (NCMPA1)
North Carolina Utilities Commission (NCUC)
In the area of electricity, the NCUC’s primary function is to regulate the retail rates and customer services of
North Carolina’s investor-owned utilities and to determine whether the construction or sale of power plants
is justied on the basis of meeting “public convenience and necessity.” NCUC is charged with ensuring that
utilities, including the Power Agencies’ municipal utility members, comply with North Carolina Senate Bill 3’s
Renewable Energy and Energy Eciency Portfolio Standard.
NOX
A generic term for nitrogen oxide (NO) or nitrogen dioxide (NO
2
), both of which are formed during the
combustion of fossil fuels and contribute to the creation of smog and acid rain.
nuclear reactor
An apparatus in which nuclear ssion (the splitting of atoms) may be sustained, as a chain reaction, and
controlled. e ssion creates heat, which heats water, which makes steam, which turns the turbine blades, which
rotates the generator, which makes electricity.
Nuclear Regulatory Commission (NRC)
e federal agency responsible for licensing and safety of nuclear power plants.
O
ofcial statement
A complex document containing information about an issue of bonds being oered and about the Power Agency
that is issuing those bonds. A full disclosure of all facts pertinent to a potential investor is required in an ocial
statement. A preliminary ocial statement, which is mailed before the bonds are priced, has red ink on its cover
is called a red herring. When a private utility company prepares an ocial statement before the issuance of debt,
it’s called a prospectus.
on-line
When a generating plant is in operation, it is on-line (formerly “on the line”). When an operational unit is not
on-line, it is said to be down or o-line.
operation and maintenance (O&M)
All activities necessary to run a power plant in a safe and economical manner.
North Carolina Utilities Commission (NCUC)
operation and maintenance (O&M)
original issue discount bonds
Bonds that are initially issued at a cost below par, which is one of many possible marketing devices.
outage
An interruption in electric supply, either based at the local distribution system, the transmission system, the
generating facility or combinations of all three. Outages can be planned or unplanned. Planned outages allow
utilities to perform needed equipment maintenance.
ownership interest
e portion of a facility, such as a generating plant or unit, in which an entity has acquired an ownership
position, typically expressed as a percentage of the entire plant or generating unit.
P
Participant
A municipality that has an ownership interest in North Carolina Municipal Power Agency Number 1 (NCMPA1).
par value
e principal amount of a bond; the amount of money due at maturity.
peak demand
e maximum demand (load) of an electric system during a given period of time: an hour, day, month or year.
(See demand.)
peaker plant
An electric generating plant that does not operate continually.
plug-in hybrid electric vehicle (PHEV or PHV)
A hybrid vehicle with rechargeable batteries that can be restored to full charge by connecting a plug to an
external electric power source (usually simply a normal electric wall socket). Also known as a plug-in hybrid.
polychlorinated biphenyl (PCB)
PCB is a carcinogen formerly used in electric system components such as transformer and switchgear oils.
original issue discount bonds
polychlorinated biphenyl (PCB)
Power Agency
Joint action Power Agencies were rst formed in North Carolina in 1976 to develop generation facilities. North
Carolina Municipal Power Agency Number 1 (NCMPA1) is comprised of 19 municipalities in the piedmont
and western part of the state. North Carolina Eastern Municipal Power Agency (NCEMPA) is comprised of 32
municipalities in eastern North Carolina.
power sales contract
An agreement between a participating municipality and a Power Agency. It denes the relationship and
responsibility that each has to the other in an agency’s joint action project.
precipitator
A device designed to remove ne particles (soot) from coal ue gas by endowing them with an electric charge
and then passing them over an oppositely charged collector plate. It is used at coal-red generating units.
pressurized water reactor (PWR)
See steam generator.
pricing
Pricing a bond issue is the process of determining interest rates and the underwriters’ spread during the process
of marketing the issue. (See spread.) Ideally, pricing provides a rate that is both fair (to a Power Agency and the
underwriters) and marketable.
private power companies
See investor-owned utilities.
project nancing
A type of nancing agreement that allows additional bonds to be issued only for the completion or betterment
of a specic project. (See system nancing.)
project power
A Power Agency’s share of the output (both capacity and energy) from generating units in which the agency has
an ownership interest.
Power Agency
project power
Public Staff
e Public Sta of the N.C. Utilities Commission. It is the responsibility of the Public Sta to represent “the
using and consuming public” in all matters coming before the Commission.
Public Utility Regulatory Policies Act (PURPA)
e Public Utility Regulatory Policies Act, passed in1978, PURPA requires states to implement utility
conservation programs and create special markets for cogenerators and small power producers.
Q
quality assurance (QA)
A system for ensuring a desired level of quality.
R
ratchet (or demand ratchet)
A rate provision whereby the greater of the current demand reading or any of the highest demand readings from
previous months is used to establish a minimum current billing demand. e purpose of a ratchet is to equalize
among all customers in a given class the added cost of supplying peak power demand.
rate case
e process in which a utility seeks approval from a regulatory entity of the electric rates that the utility
charges its customers. A rate case usually involves formal legal proceedings in which large amounts of complex
information about the utility’s costs, nances, power plants, customer requirements, etc., are reviewed by
multiple intervening parties over the course of weeks or months, culminating in a decision by the regulatory
entity about the reasonableness of the proposed rates.
rate stabilization fund
An accounting device that sets aside funds to mitigate future cost increases so that the rates a Power Agency will
have to charge its participating municipalities in the future will be either lower or more stable (or both) than they
otherwise would have been.
Public Sta
rating stabilization fund
rating agencies
Moody’s Investors Service (Moody’s), Standard and Poor’s (S&P) and Fitch Ratings are the principal independent
investor service organizations. ey specialize in collecting, analyzing and publishing nancial information and
provide for individual bond issues ratings that are designed to reect the quality of the security involved in the
debt. e higher the rating a Power Agency’s bonds has, the less interest it will have to pay to successfully market
the issue.
reactor coolant system
Part of a system of circulating water that cools the reactor core by removing heat created by a nuclear
chain reaction.
reactor vessel
e steel tank containing the reactor core. (See core.) It is also called the pressure vessel.
refueling outage (RFO)
A planned outage of a nuclear reactor to refuel it. Oen additional maintenance is performed during an RFO.
regional transmission organization (RTO)
An electric power transmission system operator that coordinates, controls and monitors a multistate electric grid.
registered bonds
Bonds whose principal and interest are payable only to the owner whose name appears on the front of the bond
and who is registered with the issuer of the bond, or with the issuer’s agent. A registered bond can be transferred
only when endorsed by the registered owner. Interest payments are made by the issuer directly to the registered
bondholder. Since July 1, 1983, all municipal bonds have been registered bonds.
reload fuel
About once a year, approximately a third of the fuel in a nuclear reactor core has to be replaced with unspent
(unused) fuel.
Renewable Energy and Energy Efciency Portfolio Standard (REPS)
A system of rules and regulations (see Senate Bill 3) in which IOUs, cooperatives and municipal electric utilities
in North Carolina are obligated to obtain portions of the electricity delivered to their customers from renewable
resources (such as wind, solar, hydro and biomass) and/or reduce the energy requirements of their customers by
implementating energy-eciency programs.
rating agencies
Renewable Energy and Energy Eciency Portfolio Standard (REPS)
renewable resources
Fuels used to generate electricity that can be replenished by the environment. Renewable resources include wind,
biomass, solar, geothermal, hydro and ocean waves/tides.
replacement energy
Additional energy to which a Power Agency may be entitled to compensate for the eect of a reduction in the
output of generating units in which the agency has an ownership interest.
reserve capacity
Capacity purchased under contract, and made available to a Power Agency under the contract’s terms to help
oset any loss of the agency’s retained capacity.
retail sales
Sales of electricity to residential, commercial, industrial and governmental end users.
retail wheeling
e process of moving electric power from a generator across one or more transmission and distribution systems
for delivery to a retail customer.
retained capacity
e amount of capacity that a Power Agency has available to it as a result of its ownership interest in
a generating plant.
revenue bonds
See electric revenue bonds.
rulemaking
A formal proceeding by FERC or another government agency to set broad rules that will apply in many dierent
future cases coming before that agency.
S
scram
e rapid shutdown of a nuclear reactor, either by the reactor operator or automatically, accomplished by
dropping control rods into the core to halt ssion.
renewable resources
scram
scrubber
A device (technically, a ue gas desulfurization system) that “scrubs” smokestack gases to reduce the amount
of sulfur dioxide that is exhausted into the air as the result of burning coal.
Senate Bill 3
A North Carolina statute enacted in 2007 under which electric power suppliers in the state are obligated to meet
certain standards pertaining to purchases of electricity from renewable resources and the implementation of
energy-eciency programs. (See Renewable Energy and Energy Eciency Portfolio Standard REPS.)
SERC Reliability Corporation (SERC)
e entity certied by NERC to enforce reliability standards for the bulk power system in the southeast area
of the U.S.
sinking fund
A fund established for money that bond issuers use to buy back some of any given issue annually and retire that
part of the debt, so that the entire debt will not have to be repaid at one time. ey shrink—or sink—the debt.
site emergency
An emergency declared by a utility when an incident at a nuclear power plant threatens the release of
radioactivity into the immediate area of the plant.
smart grid
An evolving concept in which the various components of the electric system (generation, transmission,
distribution, customer facilities) are able to communicate with each other and work together, usually
instantaneously, to increase reliability, reduce costs, provide greater environmental stewardship,
accommodate new technologies (such as electric vehicles) and reduce the threat of hostile acts. For
example, using a smart meter enables two-way communication between a customer’s appliances and the
electric utility so that the customer can see how much electricity is being used in his home, and what it
costs, on a real-time basis.
solar thermal
e process of concentrating sunlight on a relatively small area to create the high temperatures needed to
vaporize water or other uids to drive a turbine for generation of electric power.
scrubber
solar thermal
Southeastern Power Administration (SEPA)
e government marketing agency for numerous federally owned hydroelectric projects in the southeast
area of the United States. Many of the municipal electric utilities in North Carolina receive power from SEPA
(pronounced “SEE-pa”) facilities.
SOX
A term used collectively for various sulfur oxides that are emitted as byproducts of fossil fuel combustion and
classied as air pollutants. (See acid rain.)
spent fuel
Nuclear fuel that has been depleted to the extent that it can no longer sustain a chain reaction and must,
therefore, be replaced.
spinning reserve
Extra electrical capacity in a generating unit that is held in reserve in case it is needed. It is connected to the bus
and is immediately available for use in case of an unanticipated need.
spread
e fee the underwriters get for selling a bond issue. Called the underwriter’s discount or gross spread, it is
the dierence between what the investment bankers pay a Power Agency for the bonds it issues and the initial
process at which the bonds are reoered for sale to the public. e spread includes the prots, fees and expenses
of the underwriters.
steam generator
A piece of equipment that generates steam, such as a boiler. In a pressurized water nuclear plant, such as
Catawba Nuclear Station, it is a large heat exchanger. Heated water from the reactor ows through thousands
of tubes, transferring its heat to the feedwater, which boils and makes steam to turn the turbine. Boiling water
nuclear plants, such as Brunswick Steam Electric Plant, do not have steam generators. Steam in this type of plant
comes directly from the reactor.
step-down transformer
Electricity is transmitted over a transmission system at high voltage because that is more ecient, but when
it reaches a delivery point it must be reduced to the lower voltage used by a distribution system. A step-down
transformer does that job.
Southeastern Power Administration (SEPA)
step-down transformer
step-up transformer
A step-up transformer is used at generating plants to increase the voltage of generated electricity to the higher
voltage that will be used to send it over the transmission system.
substation
Step-down transformers are located in substations, which provide the link between high-voltage transmission
systems and relatively low-voltage distribution systems.
supplemental capacity
Capacity that a Power Agency purchases to meet the demand of its participants when that demand exceeds the
capacity of generation the agency owns.
support facilities
e facilities of a generating station that are not specically part of or directly identied with the generating
units, such as railroad tracks and coal-handling machinery.
surplus energy
Energy from the physical or contractual generating resources owned by a Power Agency that is in excess of the
agency’s load. Surplus energy can be sold to wholesalers in the bulk power market.
syndicate
See managing underwriters.
System Betterment
An ElectriCities program introduced in 1986 that emphasizes system eciency and reliability. Collectively,
participating members have saved about $3.5 million annually aer beginning to implement programs in 1988.
system nancing
A type of nancing agreement that allows additional bonds to be sold for any additional project approved by
a Power Agency’s Board of Commissioners. (See project nancing.)
T
take and pay
A power sales contract that requires payment to be made only for power actually received.
step-up transformer
take and pay
takedown
e selling commission paid to the banks that are part of the bond underwriting group. It is the major
component of the spread.
take or pay
A power sales contract that requires payment to be made whether or not the power contracted for is received.
For projects nanced by the issuance of electric revenue bonds, take or pay contracts are standard agreements
because the repayment of the debt must be secured if the bonds are to be marketable.
therm
A unit of energy equal to 100,000 Btus.
thermal plant
A generating unit that uses heat as the primary means to generate electricity.
Three Mile Island
e nuclear generating facility in Middletown, Pennsylvania, that essentially transformed the regulatory process
for nuclear power plant licensing. An accident at the plant in March 1979 destroyed a reactor and spurred
interest in nuclear safety. No one was killed or injured during the incident.
time-of-use rate
Pricing electricity based on the time of day, month or season. It rewards customers for using electricity during
the o-peak period with a low rate and penalizes its use during peak periods with a higher rate.
transformer
An electromagnetic device (coils of wire wound around an iron core) used for changing the voltage of
alternating-current electricity.
transmission dependent utility (TDU)
A utility that does not own transmission facilities, but instead uses another utility’s transmission system in
exchange for paying a wheeling fee. (See wheeling.)
takedown
transmission dependent utility (TDU)
transmission facilities
e relatively higher-voltage system (typically, greater than 100,000 volts and up to 750,000 volts) of
transformers, power lines, poles and substations that brings electricity from electric generators to the lower-
voltage distribution system. e delivery of electricity over long distances is much more ecient and economic
when high voltages are used.
transmission loss
Electrical energy lost in the process of transporting it over transmission lines. Losses increase with distance, high
ambient temperatures and smaller conductor sizes and vice versa.
trip
A sudden shutdown of a piece of equipment, such as a nuclear reactor. (See scram.)
true interest cost (TIC)
e interest cost of a bond issue calculated on the basis of compound interest. is method is based on the
present value, or “present worth,” of money, which is greater today than it will be tomorrow. True interest cost
provides a means of valuing cash payments spread over time, as the payment of bond debt is. True interest cost is
slightly higher than net interest cost.
turbine
A turbine is a very sophisticated system of propeller-type blades that are turned by the force of water, wind
or expanding gases such as steam. e turbine is connected to the electrical generator in a power plant. e
turbine-generator combination converts mechanical power, such as the ow of steam, to electrical power.
U
underwriters’ discount
See spread.
V
volt
e unit of electrical force or electrical pressure.
transmission facilities
volt
W
watt
e unit of electric power equal to the rate of energy transfer of one ampere owing under a force of one volt.
wheeling
A service provided when one utility transmits power over its lines on behalf of a second utility. e owner of the
lines charges a wheeling fee to provide the service.
Y
yellow cake
Uranium oxide. On average, one ton of uranium ore will yield about three pounds of yellow cake, which is
produced by a mill that crushes, grinds and dissolves the ore and then dries it so that it becomes a powdery,
yellow concentrate. Enriched yellow cake can become fuel for a nuclear reactor. (See enriched fuel.)
watt
yellow cake
ECONOMIC DEVELOPMENT TERMS
501(c)(3)
e Internal Revenue Service code that grants exemption from federal income tax to a nonprot organization.
Donations to such organizations are tax deductible. e organizations described in 501(c)(3) are commonly
referred to under the general heading “charitable organizations.”
501(c)(6)
e Internal Revenue Service code that grants exemption from federal income tax to a business league. Trade
associations and professional associations are considered to be business leagues. e business league must be
devoted to improving business conditions of one or more lines of business as distinguished from performing
particular services for individual persons . No part of its net earnings may inure to the benet of any private
shareholder or individual and it may not be organized for prot or organized to engage in an activity ordinarily
carried on for prot.
A
anchor store
e largest store, or one of the largest, in a mall or shopping center.
angel investor
An investor who provides equity investment to startup businesses.
assessed valuation
e monetary worth of a property for the purposes of taxation. Total assessed valuation denotes the sum of the
monetary worth of all taxable properties within a jurisdiction
B
backward and forward linkages
Economic connections among companies. Backward linkages involve purchasing inputs by a given rm from
another; forward linkages involve selling the given rm’s outputs to another company.
bank community development corporation (CDC)
Bank-sponsored community development corporations are a way for banks to contribute to economic
501(c)(3)
bank community development corporation (CDC)
revitalization by investing in local businesses and real estate investment projects that benet low- and moderate-
income groups. A community can establish a bank CDC by working with one or more local banks, the Federal
Reserve, the Comptroller, and its respective state nancial institutions’ regulators. In the case of consortium
bank CDCs, where several banks join together, the investors do not have to be just local banks. Bank CDCs can
purchase, construct or rehabilitate property.
base industry
Also known as “export” or “primary” industries, base industries sell or export their products and services outside
the community and bring new money into the community, increasing the total dollars that circulate within the
community and that are spent on nonbase industries.
benchmarks
Quantiable measures of economic competitiveness and quality of life that can be collected on a regular basis
and are used to measure a region’s economic status and progress against comparable regions.
big-box store
A large establishment that’s usually part of a major retail chain such as Target, Kohl’s or Home Depot.
brick-and-mortar
Retail shop located in a building as opposed to those that are strictly online, door-to-door, in a kiosk or other
similar site not housed within a structure.
browneld
Commercial or industrial site that is abandoned or under-utilized and has real or perceived
environmental contamination.
business assistance center
A one-stop center for streamlining local permitting, licensing and fee payment processes and facilitating
decision-making processes.
business attraction
Eorts by local economic development organizations to encourage rms from outside their communities to
locate headquarters or other operations within their jurisdictions.
business climate
e environment of a given community that is relevant to the operation of a business; usually includes tax rates,
attitudes of government toward business, and availability.
base industry
business climate
business creation
Economic development strategy that focuses on encouraging forming new companies that are locally based and
will remain in the community and grow.
business incubator
Entity that nurtures and supports young companies until they become viable, providing them with aordable
space, technical and management support, equity and long-term debt nancing, and employment. e three
basic objectives in creating an incubator are to spur technology-based development, diversify the local economy,
and assist in community revitalization.
business improvement districts (BIDS)
Legally dened entities formed by property and business owners, where an assessment or a tax is levied for
capital or operating improvements as a means of supplementing city funding. e district is created by the public
law or ordinance and is administered by an entity responsible to the district’s members or to the local governing
body. Some states authorize nongovernmental, nonprot corporations. Recent BID programs include economic
and social development, transportation, parking management, and converting redeveloped commercial
buildings for residential use.
business recruitment and attraction
Traditional approach to economic development to entice companies to relocate or set up a new branch plant or
operation in a state or locality; oen referred to as “smokestack chasing.”
business retention
Systematic eort designed to keep local companies content at their present locations and includes helping
companies cope with changing economic conditions and internal company problems.
C
cannibalism
e impact that a new retail location will have on an existing store’s sales in a chain corporation.
capacity building
Developing the ability of a community-based neighborhood organization to eectively design economic
development strategies through technical assistance, networks, conferences and workshops.
business creation
capacity building
central business district (CBD)
An area with the highest concentration of businesses, including nancial institutions, shops, oces, theaters
and restaurants.
Certied and Preferred Lenders Program
U.S. Small Business Administration program that encourages highly active and expert lenders to provide funds
to borrowers.
Certied Development Company (CDC)
e originating and administrating body for SBA 504 loans. e program provides long-term, xed-rate
nancing to small businesses to acquire real estate, machinery and equipment for expanding a business or
modernizing facilities.
clawbacks
e punitive steps taken against rms that break contracts that require local commitments with rms to which
they oer incentives. For example, a rm may be required to pay nes or assist in nding a new tenant for its
property if it chooses to leave a community.
clusters
Collocation of rms in the same or similar industries to foster interaction as a means of strengthening each other
and enhancing the community’s competitive advantage.
Community Development Block Grants (CDBG)
A system of unied block grants under which communities with more than 50,000 people are entitled to receive
funding, while other communities may apply for discretionary funding. e purpose of CDBG is to encourage
more broadly conceived community development projects and expand housing opportunities for low- and
moderate-income persons. e three primary goals of CDBG are to serve low- and moderate-income people,
eliminate slums and blight, and address other community development needs that pose a serious and immediate
threat to the health and welfare of the community. is program has provided signicant support for economic
development projects.
community development corporation (CDC)
Organizations, typically 501(c)(3) nonprots, that can obtain federal and private support. ey are governed
by local residents, businesses and community leaders through a board of directors that is in most cases elected
from the CDC membership or the community. Most CDCs work only on housing issues, while some perform
only economic development services. ose active in economic development provide technical assistance and
nancing and are committed to serving the impoverished people of America.
central business district (CBD)
community development corporation (CDC)
Community Development Financial Institution (CDFI)
A specialized nancial institution that works in market niches that have not been adequately served by
traditional nancial institutions. CDFIs provide a wide range of nancial products and services, including
mortgage nancing, commercial loans, nancing for community facilities, and nancial services needed by
low-income households. Some CDFIs also provide technical assistance. To be certied as a CDFI by the CDFI
Fund of the Department of the Treasury, an institution must engage in community development, serve a
targeted population, provide nancing, have community representatives on its board, and cannot be a
governmental organization.
community development venture capital
Capital made available through funds created by local communities for the purpose of making venture capital
accessible to entrepreneurs in low-income areas.
comparative advantage
e economic advantage gained by one area over another due to the fact that it can produce a particular product
more eciently. More ecient production of one good means there is a higher opportunity cost to produce
another. is is the concept that drives trade between economies. Inter-regional and international trade exploits
the comparative advantages of economies.
Consolidated Plan (ConPlan)
Combination of all of the planning, application, and performance requirements previously required separately
for Community Development Block Grants (CDBG), HOME, Emergency Shelter Grants (ESG), Housing
Opportunities for People with AIDS (HOPWA), and programs, such as HOME, that require a Comprehensive
Housing Aordability Strategy (CHAS).
corporate welfare
Government subsidies targeted to large corporations.
cost-benet analysis
A method for evaluating the protability of alternative uses of resources.
cost-effective analysis
Compares alternative projects or plans to determine the least costly way to achieve desired goals. Usually, some
index or point system is developed to measure the eectiveness of the proposal in meeting the goals
and objectives.
Community Development Financial Institution (CDFI)
cost-eective analysis
customized training
Learning designed to meet the needs of a given employer; used by local governments to attract or retain
major employers.
D
demand-side theory of development
Economic development that focuses on discovering, expanding, and creating new markets; forming new
businesses; nurturing indigenous re-sources; and involving government in the economy.
E
eco-industrial park
Industrial park designed to encourage business interaction in ways that foster reusing waste streams, recycling
inputs and other mechanisms.
economic base
A method of classifying all productive activity into two categories: basic industries that produce and sell goods
that bring in new income from outside the area and service industries that produce and sell goods that simply
circulate existing income in the area.
economic base analysis
A comprehensive study of a locality’s economy, focusing on the importance of exports. It should include an
economic history, data on existing industries, and trends and forecasts of growth in wages and employment.
Economic Development Administration (EDA)
Created by the Public Works and Economic Act of 1965 as a part of the Commerce Department, the EDA’s main
goals are to alleviate unemployment and diversify the economy, as well as to assist urban areas with planning and
emergency public works programs.
econometric modeling
A qualitative method for analyzing the impact of a proposed action on the economy. A model permits testing the
eects of an anticipated or hypothetical change.
economies of scale
e phenomenon of production where the average cost of production declines as more of the product is produced.
customized training
economies of scale
edge city
A newly emerged city that serves as a work and shopping center, with a large amount of oce and retail space.
eminent domain
e authority to “take” private property upon paying a fair price for the property and relocating the tenants. e
most frequent use of this authority is the act of “condemnation.”
Empowerment Zones/Enterprise Communities (EZ/EC) Initiative
Established in 1994 and administered by the Department of Housing and Urban Development and the Department
of Agriculture, the federal EZ/EC tools include not only business tax incentives but also transportation to work
or school, drug and alcohol rehabilitation, and other local priorities. e program creates incentives for localities
to develop their own approaches to alleviate poverty. All federally designated zones are areas of pervasive poverty,
unemployment and general distress. Each designated city receives a mix of grants and tax-exempt bonding, while
employers in the EZ/EC receive tax credits for new hires and accelerated depreciation credits.
enterprise development
Assistance to entrepreneurs in support of creating, growing and sustaining their businesses.
enterprise zones
Designated geographic areas that are eligible for special treatment and incentives to attract private investment.
State guidelines dene the size of a zone and the minimum level of economic distress to qualify as an enterprise
zone. States can also limit the number and type of enterprise zones. ese restrictions are generally set out in the
state enterprise zone program.
entitlement community
A community is eligible to receive annual CDBG funds that it can use to revitalize neighborhoods, expand
aordable housing and economic opportunities, and/or improve community facilities and services, principally
to benet low- and moderate-income persons. Eligible grantees include local governments with 50,000 or more
residents, other local governments designated as central cities of metropolitan areas, and urban counties with
populations of at least 200,000 (excluding the population of entitled cities). e state CDBG program oers
funds to the state that they then allocate among localities that do not qualify as entitlement communities.
entrepreneurial training
Programs that provide guidance and instruction on business basics, such as accounting and nancing, to ensure
that new businesses improve their chance of success. e most common instructional methods include classroom
training, workshops, speakers, peer groups and one-on-one counseling, lectures, internships, and self-study.
edge city
entrepreneurial training
equity nancing
Investments are typically secured in this type of nancial support in return for partial ownership of an
enterprise; three mechanisms can be used for receiving an equity position in a rm: common stock, preferred
stock and convertible debt.
e-tailing
Internet retailing.
F
rst wave
Strategic paradigm of economic development that focuses on business attraction tactics.
scal impacts
Direct and indirect costs incurred and revenues received by local governments resulting from land use and other
types of decisions.
franchise
e right under which a franchisee person or company may market a product or service, as granted by the
franchisor (the proprietary owner).
G
green retailing
Environmentally friendly practices of retailers, such as using recyclable packaging or reusable shopping bags.
gap nancing
A loan required by a developer to bridge the gap, i.e., to make up a deciency, between the amount of mortgage
loan due upon project completion and the expenses incurred during construction (nancing that covers the
dierence between what a project can support and the cost of development or purchase).
general obligation (G.O.) bonds
Traditional form of borrowing for state and local government, secured by full faith and credit of jurisdiction.
limited tax G.O. bonds
Tax-exempt bonds secured by the revenue from applying a xed rate against taxable property. Not all states
permit limited tax G.O.s, but in those that do, such bond issuance does not require voter approval.
equity financing
limited tax G.O. bonds
unlimited tax G.O. bonds
Tax-exempt bonds secured through taxes that are levied without rate or amount limitations in order to repay
the principal and interest of the bond. ey are typically used to nance public works infrastructure and land
acquisition for blight elimination.
I
impact fees
Fees required to cover costs of improving and/or building infrastructure needed as a result of the expected
impact of development projects on those facilities; oen required by localities for the approval of
development projects.
incentives
Benets oered to rms as part of an industrial attraction strategy. Incentives include tax abatements and credits,
low-interest loans, infrastructure improvements, job training and land grants.
incubator-without-walls
Form of business incubation that does not take place in a single building, but instead comprises a network of
entrepreneurs and entrepreneurship service providers throughout a community or region.
industrial development bond (IDB)
Bonds used to nance acquisition, construction, expansion, or renovation of manufacturing facilities and
purchasing machinery and equipment depending upon state law. IDB nancing is subject to state and local laws
and federal income tax laws and regulations if the interest on the bonds is expected to be exempt from federal
income taxation.
industrial revenue bonds
Bonds that provide lower-cost nancing for real property improvements or for purchasing or constructing
buildings, facilities or equipment.
industry clusters
Groups of similar and related rms in a dened geographic area that share common markets, technologies and
worker skill needs, and that are oen linked by buyer-seller relationships.
infrastructure banks
Public-targeted lending facilities, nanced through a combination of bond issues, government funds and
external donor support. ey mobilize domestic funds and create an attractive vehicle for donor funding.
unlimited tax G.O. bonds
infrastructure banks
investor networks
A tool for matching up potential investors with startup rms needing capital.
Internal Rate of Return (IRR)
Interest rate at which the net present value of all the cash ows (both positive and negative) from a project
or investment equal zero; used to evaluate the attractiveness of a project or investment.
J
jobs-housing imbalance
Spatial mismatch between where people live and where they work.
just-in-time inventorying
Cost-saving approach by a manufacturer that involves maintaining no inventory of product inputs on-site.
Instead, the supplier delivers the inputs when they are needed in the production process.
L
land banking
A program that preserves industrial space for a city. A city or local development authority acquires and holds
land until a developer steps forward with a proposal for its use as an industrial site.
labor-force theory of development
Explanation of development that stresses the importance of an educated, skilled and dependable workforce for
attracting and growing businesses and accepts the concept that the public sector has a responsibility to t human
resources to the needs of the business community.
land write-down
Providing land to developers at a price that is below public sector expenses for improvements.
loan pooling
Two or more lenders contributing to a fund from which loans are made to applicants; publicly chartered,
privately funded corporations can be established to pool resources.
location theory of development
Explanation of economic development that emphasizes factors such as transportation, access to raw materials
and labor, taxes, business climate, and quality of life as they relate to industrial location.
investor networks
location theory of development
long-wave theory of development
Explanation of economic development that contends that bursts of innovation lead to economic growth
M
mezzanine capital
Funds or goods used to bridge the gap in resources from one stage of business to another. (See gap nancing.)
microenterprise
A “smaller-than-small” business operated by a person on a full- or part-time basis, usually out of a home.
Includes carpenters, daycare providers and caterers.
microloans
Very small, short-term unsecured loans given to people without credit history and/or the collateral
necessary to obtain a conventional loan. ese are available from either local lenders or the SBA’s 7(m)
Microloan Program.
Minority Businesses Development Agency (MBDA)
An agency within the U.S. Department of Commerce that provides assistance to socially or economically
disadvantaged individuals who own or want to start a business. Established in 1969, MBDA provides funding
for Minority Business Development Centers, Native American Business Development Centers, Business
Resource Centers, and Minority Business Opportunity Committees.
moderate income
According to HUD’s guidelines, households whose incomes are between 81 percent and 95 percent of an
area’s median income with adjustments for smaller or larger families are considered to have moderate income.
Dierent programs may set dierent percentages.
multiplier
A quantitative estimate of a project’s impact (in dollars, jobs created, demand).
multiplier effect
e process of dollar and job generation as a result of a new or migrating business or project, or of a local
business expanding production (to exports). e multiplier eect accounts for new local income generated
by local spending that came from outside a community.
long-wave theory of development
multiplier eect
N
NIMBY
An acronym for “not in my back yard,” used to describe the attitude of people or entities who do not want any
electric industry facilities (power plants, transmission lines, waste repositories, etc.) built on, near or within sight
of their property or town.
North American Development Bank
Founded under the auspices of the North American Free Trade Agreement (NAFTA), NADB is a “bilaterally
funded, international organization, in which Mexico and the United States participate as equal partners.” Its
purpose is to nance environmental infrastructure projects. All nanced environmental projects must be
certied by the Border Environment Cooperation Commission, related to potable water supply, wastewater
treatment or municipal solid waste management, and located in the border region.
North American Industry Classication System (NAICS)
e industrial classication code system used for categorizing industrial establishments. Beginning in 1997,
NAICS replaced the Standard Industrial Classication (SIC) as the system for classifying rms in the United
States, Canada and Mexico.
neighborhood shopping center
A planned shopping facility with the largest store being a supermarket and/or a drugstore, serves 3,000 to 50,000
people within a 15-minute drive time.
O
off-site improvements
Access roads, sidewalks and curbs, sewers, and utility lines that are o the land being developed or the lots being
sold, yet add value to the entire development.
omnichannel retailing
Establishing a presence on several platforms, such as brick-and-mortar, mobile, and online, and enabling
customers to transact, interact and engage across those channels simultaneously or interchangeably.
NIMBY
omnichannel retailing
one-stop business service centers
Facilities where business persons can go to obtain the licenses and permits needed to start up, operate and
expand their facilities. ese centers improve the local business environment while reducing the number of
separate agencies and oces a business must apply to for various licenses and permits, saving public and private
time and nancial resources.
opportunity cost
e revenue forgone by choosing one use of money and resources over another. e opportunity cost of
investing in the stock market is the interest that the money could have earned while sitting in the bank.
Overall Economic Development Plan (OEDP)
A plan developed at the city, county or EDD level, as required by EDA, to identify an area’s problems and
opportunities for economic development, dene goals and objectives, and list infrastructure and other projects
needed to achieve those goals.
P
pop-up store
Short-term shops or sales spaces that come and go within a given period.
power center
Shopping site with up to a half-dozen or so major stores and a mix of smaller stores or several complementary
stores specializing in a product category.
public-private partnership
A contractual arrangement between a public agency (federal, state or local) and a private sector entity. rough
this agreement, the skills and assets of each sector (public and private) are shared in delivering a service or
facility for the use of the general public.
R
regional shopping center
A large shopping facility appealing to a geographically dispersed market with at least one or two full-sized
department stores and 50 to 150 or more smaller retailers. e market for this center is 100,000-plus people who
live or work no more than a 30-minute drive away.
one-stop business service centers
regional shopping center
retail leakage
Occurs when local people spend more for goods than local businesses actually acquire. It indicates an unsatised
demand within the area and signals a locality to provide certain types of businesses.
return on investment (ROI)
Usually expressed as a percentage and typically used for personal nancial decisions, to compare a company’s
protability, or to compare the eciency of dierent investments. e return on investment formula is: ROI =
(net prot / cost of investment) x 100.
revenue bond
Bond backed by anticipated revenue stream from a specic project.
Revolving Loan Fund (RLF)
A pool of public and private sector funds in which the money is recycled to make successive loans to
businesses. Loans made by an RLF are repaid with interest and the payments are returned to replenish the
lending pool so new loans can be made. e funds are thus recycled and the RLF grows as each generation
of borrowers adds to the pool.
S
seed capital
Equity money supplied to help a company get o the ground. It is almost always supplied by an entrepreneur and
his/her family, friends and relatives, and it’s used to help attract other investment.
second wave
Strategic paradigm of economic development that focuses on retaining rms already in the community and on
creating new businesses.
secondary nancing
A loan secured by a second mortgage on a property, sometimes used to refer to any nancing techniques other
than equity and rst-mortgage debt.
shift-share analysis
A method used to examine a local area’s basic industries in terms of their growth and decline relative to national
or regional trends.
retail leakage
shift-share analysis
site location assistance
Help provided by local governments that enables new, expanding, and relocating businesses to locate a site
that ts their facility’s needs. e assistance services include providing information on sites and organizing
visitation programs.
Small Business Administration (SBA)
Founded in 1953, SBA’s mission is to “aid, counsel, assist and protect, insofar as is possible, the interests of
small business concerns.” Its charter also mandates that the SBA ensure small businesses a “fair proportion” of
government contracts and sales of surplus property. Since its inception, the SBA has delivered more than 13
million loans, loan guarantees, contracts, and other forms of assistance to small businesses.
Small Business Development Center (SBDC)
Facility that provides business development, information and assistance in one location; administered by the U.S.
Small Business Administration.
Small Business Investment Company (SBIC)
Privately owned and managed for-prot investment rms that use their own capital, plus funds borrowed at
favorable rates with an SBA guarantee, to make venture capital investments in small businesses.
smart growth
e ecient use of all available assets. According to the American Planning Association, smart growth involves
ecient land use, full use of urban services, mixed use, mass transportation options, and detailed human-scaled design.
smokestack chasing
Pursuit of traditional manufacturing businesses by local economic development organizations.
social capital
Linkages between and among business development service providers and the companies they assist; these
linkages can be internal (within a given-service provider organization) and external (between an organization
and its clients and external service providers and businesses).
special assessment districts
Areas designated by a taxing authority to be assessed for tax purposes on a scale that diers from the rest of the
taxed jurisdiction. Property in these districts may be taxed dierently altogether. ey may be required to pay
special taxes more reective of the greater benet earned by some public expenditure in the district.
site location assistance
special assessment districts
special assessment funds
Costs of a project that benet a specic group of properties may be assessed to those individuals and accounted
for in the special assessment fund.
special improvement districts
Mechanisms where local businesses and/or residents agree to voluntarily pay an additional tax to support
improvements or services so local governments can nance and implement improvements within a specic and
limited area (similar to business improvement districts).
startup
Company in the rst stage of the evolution of a business.
startup capital
Funds that help nascent enterprises acquire space, equipment, supplies and other inputs needed to launch
a business.
supply-side theory of development
Explanation of economic development that focuses on reducing costs of production to lure capital to a new
location. Typical strategies include tax abatements, reductions, and exemptions; guaranteed and direct loans;
and reduced regulation.
sustainable development
Development that does not destroy or eventually deplete a location’s natural resources. Sustainable development
helps ensure a better, healthier living environment and contributes to an area’s quality of life—one of the main
goals of economic development.
SWOT analysis
A tool used in the economic development planning process to assess a community’s strengths and weaknesses
(factors from within a community that can be changed) as well as its opportunities and threats (factors from
outside that cannot be changed).
T
tax abatement
Exemption or reduction of local taxes of a project for a specic period of time. Contracts between a government
entity and a real estate holder that stipulate that some share of assessed value will not be taxed for an agreed time
period. A typical goal of tax abatement is to encourage economic development.
special assessment funds
tax abatement
tax credit
Money directly subtracted from a tax bill aer a tax liability has been incurred.
tax deferral
Policy that permits individuals whose property values have risen dramatically through no fault of their own to
pay taxes on the basis of old values.
tax-exempt bond
Obligation that does not require recipients of interest payments to pay taxes on the interest revenue. Although
revenue bonds may be a form of tax-exempt bonds, not all revenue bonds qualify for a tax exemption (e.g.,
stadium projects, parking facilities, and nongovernment oce buildings lost their tax-exempt status in 1986).
tax exemption
Policy that reduces the base from which property is assessed. It’s accomplished by subtracting a given amount
of money from the assessed market rate. Tax exemptions are oen granted to individuals, institutions or types
of property.
tax incentives
Using various tax relief measures, such as tax exemptions, tax credits or tax abatements, to recruit and attract
businesses to a community or to help local businesses expand.
tax increment nancing (TIF)
Tool of economic development in which taxes that can be traced to a specic development are used to repay
bonds that were issued to nance that development. When bonds are fully paid, the jurisdiction can begin to
receive the additional tax revenue produced by the development.
tax stabilization agreement
Agreement to not raise taxes signicantly; used to assure potential investors of a stable tax environment.
technical assistance
Includes help with preparing grant applications, training sta, applying for loans and marketing the product.
It may also include assisting a small business to improve its product or manufacturing process. Technical
assistance is generally aimed at providing specic services that a small business typically cannot aord, or
general business planning.
tax credit
technical assistance
third wave
Strategic paradigm of economic development that aims to create a local or regional environment that is supportive
of growth and development.
trade area
Geographic area from which a community generates the majority of its customers. is oen is the geographic
area that represents 75 percent of current customers.
U
under-employed
Includes all persons whose skills, education or training qualify them for a higher skilled or better-paying job
than they presently hold. It also includes persons only able to nd part-time rather than full-time work in
their elds.
umbrella bonds
Low-cost nancing with lower interest rates for projects too small to qualify for normal revenue bond
programs. Bond proceeds are used as loans for acquisition of land, building, machinery and equipment. e
umbrella is a pool of small bonds of $1 million or less packaged into a larger bond and issued by the state or
local economic development agency.
unemployed
As dened by the U.S. Department of Labor, the term includes all civilians who were not employed, but were
available and actively seeking work within the past four weeks, were waiting to be called back to a job from
which they had been laid o, or were waiting to report to a new job scheduled to begin within 30 days.
V
value-added
Revenue created by processing resources; the amount of revenue is greater because those resources have
been processed.
venture capital
An investment made where there is a possibility of very substantial returns on the investment, as much
as 40 percent, within a short period. It is usually invested in dynamic, growing and developing enterprises,
not in startups.
third wave
venture capital
W
Workforce Investment Act
Workforce Investment Act of 1998 is the federal government’s eort to adapt a workforce training system to
current economic conditions. WIA impacts economic development because it decentralizes decision-making
to the local level, allows local businesses to determine skill needs, adapts training to local growth patterns,
promotes inclusion of economic development principles in plans, and requires the state to submit economic
development plans with the WIA implementation plan.
wearable technology
Gadgets, such as smartwatches, that people wear that oen sync to an app or other cloud-based soware.
Workforce Investment Act
wearable technology
A
acid rain
administrative and general
(A&G)
advanced metering
infrastructure (AMI)
all-requirements customer
allowance for funds used
during construction
(AFUDC)
American National
Standards Institute
(ANSI)
American Public Power
Association
American Society of
Mechanical Engineers
(ASME)
ampere
Atomic Energy
Commission (AEC)
Atomic Safety and
Licensing Board Panel
(ASLBP)
availability
B
Balance of plant (BOP)
base load plant
basis point
bearer bonds
billing determinants
billing period
Board of Commissioners
(BOC)
Board of Directors (BOD)
boiler
boiling water reactor (BWR)
bond
bond anticipation notes
(BANs)
bond resolution
British ermal Notes (Btu)
Bulk Power Marketing (BPM)
bus (or bus bar)
C
capability
capacity
capacity factor
capitalized interest
Catawba Nuclear Station
chain reaction
cogeneration
coincident peak
combustion turbine
commercial operation
commercial paper
condenser
Construction work in
progress (CWIP)
containment building
control rod
control room
coolant
cooling tower
cooperatives or co-ops
core
coupon bonds
critical
D
decommissioning
Index - Public Power
default
delivery point
demand
demand charge
demand-side management
(DSM)
Department of Energy
(DOE)
Distributed Generation (DG)
distribution facilities
E
Edison Electric Institute
(EEI)
electric energy
electric revenue bonds
electromagnetic elds
(EMFs)
emergency core cooling
system
emergency feedwater
pumps
energy charge
enriched fuel
entitlement
Environmental Protection
Agency (EPA)
Electric Power Research
Institute (EPRI)
F
Federal Energy Regulatory
Commission (FERC)
forced outage rate (FOR)
fossil fuel
fuel assembly
fuel clause
fuel expense
fuel pool
fuel rod
G
general emergency
generation and
transmission (G&T)
generation mix
generator
geothermal energy
gigawatt
green energy
greenhouse eect
greenhouse gases
grid
H
hazardous waste
high-pressure injection
hydroelectric plant
I
independent power
producer (IPP)
independent system
operator (ISO)
infrared scanning
Institute of Nuclear Power
Operations (INPO)
interchange agreement
interconnection agreement
interruptible power
investor-owned utilities
(IOUs)
J
joint action agency
K
kilovolt-amperes (kVa)
kilowatt (kW)
kilowatt-hour (kWh)
L
lead manager
leased facilities fee
line loss
load
load curve
load factor
load forecast
load management program
load-side generation
M
managing underwriters
maximum net dependable
capacity (MNDC)
McGuire Nuclear Station
megawatt (MW)
metering period
N
net interest cost (NIC)
NIMBY
nitrogen oxide (NOX)
non-coincident peak
non-Power Agency
member
North American Electric
Reliability Corporation
(NERC)
North Carolina Association
of Municipal Electric
Systems (NCAMES)
North Carolina Eastern
Municipal Power Agency
(NCEMPA)
North Carolina Municipal
Power Agency Number 1
(NCMPA1)
North Carolina Utilities
Commission (NCUC)
NOX (nitrogen oxide)
nuclear reactor
Nuclear Regulatory
Commission (NRC)
O
ocial statement
on-line
operation and maintenance
(O&M)
original issue discount
bonds
outage
ownership interest
P
Participant
par value
peak demand
peaker plant
plug-in hybrid electric
vehicle (PHEV)
polychlorinated biphenyl
(PCB)
Power Agencies
power sales contract
precipitator
pressurized water reactor
(PWR)
pricing
private power companies
project nancing
project power
Public Sta
Public Utility Regulatory
Policies Act (PURPA)
Q
quality assurance (QA)
R
ratchet
rate case
rate stabilization fund
rating agencies
reactor coolant system
reactor vessel
registered bonds
refueling outage (RFO)
regional transmission
organization (RTO)
reload fuel
Renewable Energy and
Energy Eciency
Portfolio Standard
(REPS)
renewable resources
replacement energy
reserve capacity
retail sales
retail wheeling
retained capacity
revenue bonds
rulemaking
S
scram
scrubber
Senate Bill 3
SERC Reliability
Corporation (SERC)
sinking fund
site emergency
smart grid
solar thermal
Southeastern Power
Administration (SEPA)
SOX
spent fuel
spinning reserve
spread
steam generator
step-down transformer
step-up transformer
substation
supplemental capacity
support facilities
surplus energy
syndicate
System Betterment
system nancing
T
take and pay
takedown
take or pay
therm
thermal plant
ree Mile Island
time-of-use rate
transformer
transmission dependent
utility (TDU)
transmission facilities
transmission loss
trip
true interest cost (TIC)
turbine
U
underwriters’ discount
V
volt
W
watt
wheeling
Y
yellow cake
501(c)(3)
501(c)(6)
A
anchor store
angel investor
assessed valuation
B
backward and forward
linkages
bank community
development
corporation
(CDC)
base industry
benchmarks
big-box store
brick-and-mortar
browneld
business assistance center
business attraction
business climate
business creation
business incubator
business improvement
districts (BIDS)
business recruitment and
attraction
business retention
C
cannibalism
capacity building
Certied and Preferred
Lenders Program
central business
district (CBD)
Certied Development
Company (CDC)
clawbacks
clusters
Community Development
Block Grants (CDBG)
community development
corporation (CDC)
Community Development
Financial Institution
(CDFI)
community development
venture capital
comparative advantage
Consolidated Plan
(ConPlan)
corporate welfare
cost-benet analysis
cost-eective analysis
customized training
D
demand-side theory of
development
E
eco-industrial park
economic base
economic base analysis
Economic Development
Administration (EDA)
econometric modeling
economies of scale
edge city
eminent domain
emergency feedwater
pumps
energy charge
Index - Economic Development
Empowerment Zones/
Enterprise Communities
(EZ/EC) Initiative
enterprise development
enterprise zones
entitlement community
entrepreneurial training
equity nancing
e-tailing
F
rst wave
scal impacts
franchise
fuel assembly
G
green retailing
gap nancing
general obligation (G.O.)
bonds
limited tax G.O. bonds
unlimited tax G.O. bonds
I
impact fees
incentives
incubator-without-walls
industrial development
bond (IDB)
industrial revenue bonds
industry clusters
infrastructure banks
investor networks
Internal Rate of Return
(IRR)
J
jobs-housing imbalance
just-in-time inventorying
K
kilowatt
kilowatt-hour
kVa
L
land banking
labor-force theory of
development
land write-down
loan pooling
location theory of
development
long-wave theory of
development
M
mezzanine capital
microenterprise
microloans
Minority Businesses
Development Agency
(MBDA)
moderate income
multiplier
multiplier eect
N
NIMBY
North American
Development Bank
North American Industry
Classication System
(NAICS)
neighborhood shopping
center
O
o-site improvements
omnichannel retailing
one-stop business service
centers
opportunity cost
Overall Economic
Development Plan (OEDP)
P
pop-up store
power center
public-private partnership
R
regional shopping center
retail leakage
return on investment (ROI)
revenue bond
Revolving Loan Fund (RLF)
S
seed capital
second wave
secondary nancing
shi-share analysis
site location assistance
Small Business
Administration (SBA)
Small Business
Development Center
(SBDC)
Small Business Investment
Company (SBIC)
smart growth
smokestack chasing
social capital
special assessment districts
special assessment funds
special improvement
districts
startup
startup capital
supply-side theory of
development
sustainable development
SWOT analysis
T
tax abatement
tax credit
tax deferral
tax-exempt bond
tax exemption
tax incentives
tax increment nancing (TIF)
tax stabilization agreement
technical assistance
third wave
trade area
U
under-employed
umbrella bonds
unemployed
V
value-added
venture capital
W
Workforce Investment Act
wearable technology
Notes
ElectriCities of North Carolina, Inc.
Meadow Wood Blvd.
Raleigh, NC
--
electricities.com
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