Key terms and issues explained

Mae’r dudalen yma ar gael yn Gymraeg.

On this page you will find a range of key terms explained. Please click on a letter below to be taken to a list of terms and on "show" to read the explanation.

Tariff

The package of charges and conditions that a supplier offers you for providing electricity, gas or both.

Tariff Information Label (Label)

The Tariff Information Label gives you key information about your energy tariff. It aims to help you easily compare your tariff with others available. Suppliers have to give a Tariff Information Label for each of their tariffs, in a clear and easy to understand form free of charge. You’ll usually find the label on your energy bill or annual statement, and suppliers must publish a label for each of their live tariffs on their website. You can directly request it from your supplier too, and they must also provide it when informing you about the principal terms of a contract.

The label includes the key features of a tariff, which usually includes things such as:

  • Supplier’s name
  • Tariff name
  • Tariff type (e.g. fixed or variable)
  • Payment method (e.g. Direct Debit)
  • Unit rate – measured per kWh, this is the price you pay for the energy you use
  • Standing charge - a fixed monthly/daily amount that you pay your electricity/gas supplier for maintenance and other costs, such as maintaining connection to the power network
  • Tariff end date (if applicable)
  • Price guarantee – if the price is guaranteed until a given date this is shown here
  • Exit fees – if the supplier charges a penalty for switching from a tariff before its end date, the level of the amount is shown here

You may need to provide your address or postcode to access an online Tariff Information Label, but should not need any other information.

Tariff Structure

The way in which a tariff’s charges are structured. For example, some tariffs have a single unit rate whilst others have more than one unit rate (multi-rate).

Telesales

A method of direct marketing in which a salesperson solicits prospective customers to buy products or services over the phone.

Termination (exit) fees

Where part of their contract, these are the contractually agreed fees a customer must pay if they terminate their contract before the agreed contract end date.

Third Package

The term Third Package refers to a package of EU legislation on European electricity and gas markets that entered into force on the 3rd September 2009. The purpose of the Third Package is to further liberalise European energy markets. DECC is primarily responsible for its transposition in Britain and had to do this by the 3rd March 2011.

Third Party Intermediaries

Third Party Intermediaries (TPIs) are companies that can offer advice and products to assist with a range of functions including energy procurement, efficiency and management. They can include switching websites, energy brokers and energy efficiency advice providers who interact with energy consumers.

If you use a TPI as a business consumer, you may pay them directly or, more often, indirectly through your supplier. In the latter case your supplier may charge you a fee linked to your consumption, or a flat rate, which the supplier then transfers to the TPI.

Third Party Intermediaries: what your business needs to know

Time of Use tariff (ToU)

A tariff where the charges vary by the time when the energy is consumed, for example through different unit rates for energy consumed during the day and during the night.

Tracker tariff

This is a tariff where the price per kWh for gas/electricity will vary in reference to other prices or indices. This can be the price of another tariff from another supplier, although we are proposing these tariffs will no longer be able to track the price of tariffs offered by suppliers, but only a published stock exchange quotation or index or a financial market rate over which the supplier has no control.

Typical Domestic Consumption Values

Typical Domestic Consumption Values (TDCVs) are industry standard values for the annual domestic gas and electricity used by a typical consumer. You’ll find them in energy suppliers’ communications, on their website and on price comparison sites where they are used to calculate the cost of a typical energy bill.

They also underpin the Tariff Information Label (TIL) and Tariff Comparison Rate (TCR).

Below you can view representative typical domestic consumption values for 2015. The current TDCVs came into force on 1 September 2015. You can use these to more easily compare between supplier tariffs on a like-for-like basis. They provide a useful starting point, but it’s still important to find out what’s right for you based on more personalised information.

Typical Domestic Consumption Values 2015

  kWh TDCVs
Gas Low 8,000
Medium 12,500
High 18,000
Electricity: Profile Class 1 Low 2,000
Medium 3,100
High 4,600
Electricity: Profile Class 2 Low 2,500
Medium 4,300
High 7,200