Glossary Of Terms
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UNACCOUNTED FOR GAS (UFG)
Gas which is lost through leakage or errors in measurement.
UNBUNDLING
The separating of the various components of electricity production, supply, and service in order to introduce greater elements of competition to these segments of the industry.
"Functional unbundling" would require monopolistic utilities to provide access to their transmission and distribution network in exchange for an access fee. "Structural unbundling" would require complete vertical disaggregation so that monopolistic utilities would be required to divest either their generation assets or their transmission/distribution assets.
UNDERLYING
The variable on which a futures, option, or other derivative contract is based.
UPSIDE/DOWNSIDE RISK
A short forward position taken without an offsetting long physical position in the underlying commodity is said to have upside risk. This means that the trader is speculating that the price of the commodity will decline.
A long forward position taken without an offsetting short physical position in the underlying commodity is said to have downside risk. It means that the trader is speculating that the price of the commodity will increase.
UPSTREAM
Oil and gas exploration and production, as opposed to downstream which covers the areas of refining and marketing.
