Electrical Industry

Electrical Industry. By producing cheap power, the electrical industry contributed to America's emergence as an industrial leader and helped reshape American culture, powering the tools and appliances used in daily life. Building on Allessandro Volta's development of the battery in 1800 and Joseph Henry's work on electromagnets, Samuel F.B. Morse devised the first commercial application of electricity, the telegraph. During the 1850s, as telegraph lines spread widely, entrepreneurs in Philadelphia and Boston produced telegraph equipment. Exploiting Michael Faraday's 1830 invention of the generator, Americans also pioneered in electrical lighting. Charles Brush's direct‐current (DC) generator (1876) powered arc lights that illuminated streets, factories, and stores. In 1879 the California Electric Light Company in San Francisco set up the first central utility station. Thomas Edison, recognizing customers' desire for electric lighting similar to existing gas lights, invented in 1879 an incandescent lamp that produced light when current passed through a high‐resistance filament in a vacuum. Edison's first DC central station opened in Manhattan in 1882. Inventors also used electricity to power streetcars. Charles J. Van De Poele introduced the overhead trolley, while Frank J. Sprague installed the first successful streetcar line involving an electrified third rail in Richmond, Virginia, in 1886.

As Gilded‐Age industrialization and urbanization increased demand for electric lighting and streetcars, electrical‐equipment firms boomed, employing thousands of managers, engineers, and workers. Thanks to an AC motor invented in 1887 by Nikola Tesla (1856–1943), electricity soon replaced steam engines and waterwheels in factories. By 1890, Edison General Electric, the Westinghouse Electric and Manufacturing Company founded by George Westinghouse, and the Thomson‐Houston Electric Company were the key players. Westinghouse aggressively promoted the use of alternating‐current (AC), while Thomson‐Houston assisted fledgling utilities to fund power stations. AC, which could serve more customers over a wider area, soon became the industry standard. After Edison GE and Thomson‐Houston merged in 1892 to form the General Electric Company, the new firm dominated in finance, incandescent lamp manufacture, and the manufacture of steam turbines to power generators. In 1896, the first hydroelectric power station, at Niagara Falls delivered abundant electricity to industries in Buffalo, twenty‐five miles away, demonstrating AC's full potential.

By 1900 the basic pattern of the twentieth‐century electrical industry was established, with two major firms manufacturing equipment used by investor‐owned utilities to generate and distribute power. Seeking economies of scale, electrical utilities built ever‐larger networks. Samuel Insull of Chicago's Commonwealth Edison demonstrated how a utility could increase profitability by regional expansion and diversification. Soon Commonwealth Edison was the Middle West's sole supplier of electricity. To protect his monopoly, Insull persuaded the Illinois legislature to create a utilities regulatory commission. As other states followed suit, utilities secured their monopolies by ceding rate‐setting authority to the state.

After greatly expanding generating capacity during World War I, the electrical industry in the 1920s campaigned to increase domestic consumption. Many households in this decade acquired electric stoves, washing machines, irons, radios, and vacuum cleaners. The New Deal, in turn, heavily promoted electrification through the Tennessee Valley Authority, the Rural Electrification Administration, and large‐scale hydroelectric dam projects in the West. Generating capacity further increased during World War II, and the 1950s saw renewed efforts by the electrical industry and the government to stimulate domestic consumption. Flourescent lighting and the disappearance of electric streetcars reduced demand, but air conditioning added to summertime consumption. Seeking lower costs, electrical utilities adopted nuclear reactor technology; Westinghouse opened the first nuclear power plant at Shippingport, Pennsylvania, in 1959. Predictions that electricity would soon be “too cheap to meter” went unfulfilled, however. Nuclear‐power plants proved not only expensive to build but difficult to manage and prone to dangerous accidents. The Arab oil embargo of 1973–1974 further increased utilities' fuel costs, driving up consumer rates.

Yet consumer demand for electricity increased as Americans grew more dependent on reliable electric power to heat and cool buildings, control machinery, operate appliances and computers, and supply indoor and outdoor illumination. When parts of the East Coast suffered a major blackout in 1964, daily life briefly came to a near‐halt. In response to rising demand, utilities encouraged conservation, and the federal and state governments established programs to promote wind, water, and solar power.

Deregulation of the electrical industry in the 1990s freed many utilities to buy and sell power on the open market. Where single utilities once held a monopoly, some states permitted companies to compete and customers to choose their electricity supplier. While some observers predicted that this would lower energy prices, others warned that deregulation threatened reliability. Whether the United States in an era of deregulation would continue to enjoy the cheap, reliable power essential to modern life remained to be seen as the twentieth century ended.
See also Electricity and Electrification; Energy Crisis of the 1970s; Engineering; New Deal Era, The; Rural Life; Steam Power; Technology; Twenties, The.

Bibliography

Malcolm MacLaren , The Rise of the Electrical Industry During the 19th Century, 1943.
Thomas Parke Hughes , Networks of Power: The Electrification of Society, 1880–1920, 1983.
Richard F. Hirsh , Technology and Transformation in the American Electric Utility Industry, 1989.
David E. Nye , Electrifying America: Social Meaning of a New Technology, 1990.
James E. Brittain , Alexanderson: Pioneer in American Electrical Engineering, 1992.
Mark H. Rose , Cities of Light and Heat: Domesticating Gas and Electricity in American Homes, 1995.

W. Bernard Carlson