Electron correlation concerns the dependence between electronic degrees of freedom that cannot be captured by treating each electron as moving independently. In a quantum-chemical use of the term, correlation usually means effects beyond the best single-Slater determinant Hartree-Fock method; that method already includes exchange associated with fermionic antisymmetry.
The distinction matters when comparing approximations. Dynamic electron correlation describes additional instantaneous avoidance even when one electronic configuration dominates. Static electron correlation becomes important when several configurations have comparable significance, as during some bond-dissociation processes. A correlation energy is therefore defined relative to a stated reference calculation, and the physical need for multiple configurations is different from merely allowing a single orbital to change shape.
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