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The game generally uses the term "ability" and just about every effect in the game is an ability although it more typically refers to magicka/stamina/ultimate abilities you slot on your ability bar and cast.
Spell is anything that uses magicka. Magicka abilities (aka spells) scale with Spell damage, spell crit and max magicka. Stamina abilities scale with weapon dmg & crit and with max stamina.
ESO Balance: “All skills are equal, but some skills are more equal than others.”