Glossary
Energy terms, in plain words.
The words on an electricity bill, a solar proposal and a business case, in plain language. Each one says what it is and, where it isn't obvious, why it matters.
01 Glossary
On your bill
- kWhkilowatt-hour
- The amount of energy used: a 1 kW machine running for an hour uses 1 kWh.
- Why it mattersMost of the energy charges on a bill are priced per kWh.
- kWkilowatt
- How fast energy is used at a moment: the power a machine draws while it runs.
- kVAkilovolt-ampere
- The total power the supply has to carry, useful or not. It's what the grid sizes your supply on.
- Why it mattersDemand and capacity charges on most large-power tariffs are billed on kVA, not kW.
- Power factor
- kW divided by kVA: the share of the power drawn that does useful work. 1.0 is perfect; motors and drives pull it down.
- Why it mattersBelow about 0.95, you pay demand charges on power that does no work. A capacitor bank fixes it.
- kvar and kvarhreactive power and reactive energy
- The part of the power that magnetises motors and transformers but does no work. kvarh is that over time.
- Why it mattersSome tariffs charge for reactive energy beyond a free share.
- NMDnotified maximum demand, or booked capacity
- The supply capacity, in kVA, you've agreed with your supplier to reserve for your site.
- Why it mattersYou pay for it every month whether you use it or not, and pay a penalty in a month you go over it.
- Demand charge
- A charge on the month's maximum demand: the highest kVA (or kW) in any half-hour of the month.
- Why it mattersOne busy half-hour sets it for the whole month, so a steady load pays less per kWh.
- Time of usepeak, standard and off-peak
- A tariff that prices each kWh by when it's used: dearest in peak hours (weekday mornings and evenings), cheapest off-peak (nights and weekends), and dearest of all in winter.
- Why it mattersMoving work out of peak hours saves money without using a kWh less.
- Load factor
- Average demand divided by maximum demand: how steady the load is. 1.0 would be the same load every half-hour.
02 Glossary
Solar and batteries
- kWpkilowatt-peak
- The size of a solar system: its output in full sun under standard test conditions.
- Yieldspecific yield
- How many kWh each kWp makes in a year. In South Africa, roughly 1,400 to 1,900 kWh per kWp, depending on the place, the tilt and the shading.
- Used on siteself-consumption
- The share of the solar energy the site uses as it's made.
- Why it mattersOnly this share replaces energy you'd otherwise buy at full price; the rest is exported or lost.
- Export
- Solar energy sent back into the grid because the site couldn't use it at the time.
- Why it mattersMany municipalities pay little for it, and some don't allow it at all.
- Peak shaving
- Using a battery, or moving work, to keep the month's highest demand down.
03 Glossary
Buying power and contracts
- PPApower purchase agreement
- A contract to buy power from a system someone else owns, at an agreed price per kWh, for a set number of years. The system can be on your roof or far away.
- Wheeling
- Sending power from a solar or wind farm to your site over the grid you already use, for a fee to the grid's owner.
- Take-or-pay
- A contract term that makes you pay for an agreed amount of energy, whether you take it or not.
- Why it mattersIt moves the risk of your own shutdowns and slow months to you.
- SPVspecial purpose vehicle
- A company set up to own one project: it raises the equity and the debt, builds the solar or wind farm, or the rooftop system, and sells the power.
04 Glossary
The money
- Payback
- How many years the savings take to repay what the project cost.
- Why it mattersQuick to grasp, but it ignores what happens after the payback year.
- NPVnet present value
- Every future saving and cost, turned into today's rand at a chosen discount rate, then added up. Above zero, the project earns more than that rate.
- IRRinternal rate of return
- The yearly return the project earns on its cost: the discount rate at which its NPV is zero.
- Firm and indicative savings
- Firm savings rest on measured data or a quote; indicative ones still rest on assumptions. They're shown apart and never added together.
- Why it mattersA board can approve on firm savings; indicative ones need measuring first.
- M&Vmeasurement and verification
- Proving a saving after the work is done, by measuring against an agreed baseline (the energy use before, adjusted for production and weather).
- Why it mattersIt's how a saving is shown to the board and a funder, and how it's certified for the section 12L tax allowance.
05 Contact
A word missing? Ask, and I'll add it.
Happy to explain a method, a number or how to use one of the free tools. Email is best.
- linkedin.com/in/thabisokali
Based in Johannesburg, South Africa.