Glossary

Average Costs: the total cost of production of a specific amount of generation divided by the amount generated. If we have cost data for all the blocks of power produced, we can get it straight. Otherwise, the Average Costs ($/kWh) = AHR(Btu/kWh) * fuel price ($/Btu).

Average Heat Rate (AHR): at a level of generation is the fuel energy divided by the power generated. AHR is the average of the I/O curve over time because there are deviations over time in the number of input (Btu) needed to maintain the respective output power. Thus, AHR describes the input (Btu) needed on average to produce the corresponding output. (M.-P. C.)

Heat rate: amount of fuel energy required to produce a given amount of electric energy.

I/O curve: function describing the fuel energy (input) as a function of the generation (output). (See e.g. p. 42 of http://www.energy.ca.gov/electricity/97-12-10_MCP-FORECAST.PDF)

Spark spread: (price of electric energy) - (cost of fuel needed to produce the electricity).