The market

MGP — Mercato del Giorno Prima: The Italian day-ahead power exchange. Bids must be submitted by 12:00 on the day before delivery; after that the price is set.
GME — Gestore dei Mercati Energetici: The operator of Italy's energy exchanges — power, gas and environmental markets. It publishes the results of every session.
D+1: The delivery day: the day after bids are submitted. A D+1 forecast covers tomorrow's 24 hours.
MI — intraday market: Sessions that open after the day-ahead market and let participants adjust their position as delivery approaches.
Gate closure: The moment after which no more bids are accepted. For MGP it is 12:00 on the day before delivery: the deadline that makes any forecast either useful or pointless.
European market coupling: The mechanism that clears European exchanges together, allocating interconnection capacity to whoever values it most. It is why the Italian price responds to the French and German ones.

Prices

PUN — Prezzo Unico Nazionale: The consumption-weighted average of the zonal prices. It is the reference price for end customers, not what a generator receives: sellers are paid their own zone's price.
Zonal price: The price formed in a single bidding zone. When the grid has room, all zones clear at the same price; when a line saturates, a zone decouples and sets its own.
Baseload: The average of all 24 hours of the day. It is the product that actually trades: participants buy and sell baseload, not single hours.
Peak: The central hours of working days, typically 08:00 to 20:00. On average priced above baseload.
Off-peak: The remaining hours: night, early morning, weekends. On average priced below baseload.
Intraday spread: The distance between the expensive and the cheap hours of the same day. It has widened as solar has grown and flattened the middle of the day.

Bidding zones: Italy is split into seven bidding zones: North, Centre-North, Centre-South, South, Calabria, Sicily and Sardinia. The split reflects physical limits of the transmission grid.
Coupling: When transmission capacity between two zones is enough to satisfy the flows, the two zones clear at the same price. They are said to be coupled.
Congestion: When a line between two zones hits its limit, flow cannot increase and prices separate. It is why Sicily and Sardinia frequently price away from the mainland.
Transfer limit: The maximum power that can flow between two zones in a given hour. It changes day by day with the state of the grid and with outages.
Virtual zones: Bidding points that do not map to a geographic area but to foreign interconnections or to constrained generation poles.

CCGT — combined cycle gas turbine: The plant that sets the price in most Italian hours: when more energy is needed it supplies it, and its cost becomes the market price.
Marginal cost: The cost of producing one more MWh: the gas burned plus the emission allowances. Below it, running loses money.
Spark spread: The gap between the power price and the cost of producing it from gas. A positive value indicates a margin for the plant.
PSV — Punto di Scambio Virtuale: The Italian wholesale gas hub. It is what an Italian plant actually pays for gas, distinct from Dutch TTF.
EUA — emission allowances: One allowance covers one tonne of CO2. Fossil generators must buy them, and their price feeds into the cost of production.
Heat rate: How much gas it takes to produce one MWh of power. The lower the figure, the more efficient the plant.
TTF: The Dutch gas hub, the European gas benchmark. The Italian price moves with it but does not match it.

Terna: The national transmission system operator. It sets how much power can flow between zones and keeps the system balanced in real time.
ARERA: The sector regulator: it writes the market rules and sets network tariffs.
Dispatching user: The party answerable to Terna for the injection or withdrawal schedule of a plant or a customer portfolio.
BRP — balance responsible party: The party that carries the financial consequence of the gap between what was scheduled and what actually happened.

Load: Forecast system demand, hour by hour. It is the first thing that determines how much generation is needed, and therefore which plant sets the price.
Merit order: The order in which plants are called, cheapest first. The last one needed to cover demand sets the price for everyone.
Non-dispatchable renewables: Solar and wind: they produce when the resource is there, not when it is needed. They enter the merit order first because their variable cost is near zero, and they push the price down.
Cannibalisation: When a lot of solar produces in the same hours, the price in those hours falls: a plant earns less precisely when it produces most.
Negative prices: They occur when must-run generation exceeds demand. In those hours injection carries a cost rather than a revenue.
Reservoir hydro: Generation that can be moved in time. Reservoir levels change how much of it is available over the following weeks.
Imports: Power entering from abroad over the interconnectors. When French or Swiss prices are low, imports rise and cool northern prices.

MSD — ancillary services market: Where Terna buys the resources to keep the grid balanced. It has its own prices, distinct from day-ahead prices.
Imbalance: The gap between schedule and reality. It is settled at a price not known in advance, which is why a wrong forecast costs twice.
Capacity market: A separate mechanism that pays for being available to produce rather than for energy produced. It keeps capacity alive that the energy market alone would not support.
GO — guarantees of origin: Certificates attesting that power came from renewable sources. They trade separately from the energy itself.