Here's a short glossary on electric utility deregulation.
Stranded Costs. Power plants built by electric utilities that no longer will be profitable in a competitive environment. The utilities argue that many of these investments were forced on them by regulators, therefore they should be compensated by special transition charges to prevent undue hardship or bankruptcies when competition begins.
Generation Costs. The cost of producing the power, and also the portion of the electricity bill that will be opened to competition. Some observers caution that power buyers should be clear that estimates of savings should be based on the total bill, not just generation costs. The costs for transmitting and distributing the power still will be regulated.
Cost-of-Service Regulation. The traditional method for pricing regulated utilities, where rates are based on the costs utilities incur in providing service.
Grid. A network of utilities whose power systems are connected and that easily can exchange power, allowing electricity generated in one area to be sold in another area. This, in effect, will create regional markets and regional prices for electricity. Some observers say markets will be defined by three main grids: generally west of the Rocky Mountains, east of the Rocky Mountains and the state of Texas. Others predict markets could be more regional, with minigrids encompassing parts of the country like the Midwest and Southeast.