Development of Electricity in the U.S.

Name

Class

Professor

School

City

Date
 Development of Electricity 1

Development of Electricity in U.S.A

Knowledge underpinning the development of electricity (the role of science, engineering and

innovation)

The story of invention of electricity starts way back in 600BC when Thales discovered

that rubbing amber with silicon leads to an attraction of the feathers as well as other light objects

(Gooday, 2015). Many experiments that various scientists carried out many years later were

based on this discovery. The aim of these experiments was to make known the elusive force

(static electricity) that Thales had likened to a soul. Since then, it has been established that there

is no other form of energy that is difficult to describe as electricity.

Other contributors into the discovery and development of electricity included William

Gilbert, Otto von Guericke, and Alessandro Volta among others. William discovered that there

was a similarity in the repulsion and attraction powers between two rods that were non-metallic

rods he rubbed together and those that exist when rubbing lodestone and amber. Thus, in

remembrance of Thales, he came up with the word ‘electricity’ (Gooday, 2015). On the other

hand, Guericke, a mayor and amateur scientist, was able to construct a machine that produced

high voltage charges by the means of friction. The machine consisted of two discs of glasses that

were revolving in opposite directions to each other.

A more significant discovery came with Alessandro Volta. In 1799, he made construction

of a simple cell that could produce electron flow using chemicals. He constructed this cell using

two plates, copper and zinc that were placed in a solution of an acid. He then allowed a flow of

the charges through a wire that was connecting the two plates externally. Later, using layers of

copper and zinc discs that were alternating and separated by the discs of flannel that were soaked
 Development of Electricity 2

in brine, he was able to connect cells in series, thus producing a higher electric pressure.

However, the undoing of Volta is that he did not come up with the accurate explanation of the

functioning of his innovation. His thinking as that this cell’s functioning was because of the

connection between the two metal plates as opposed to the chemical action of the electrolyte.

However, this discovery made a big impact in research concerning lighting, heating, magnetic,

and chemical effects of electricity (Gooday, 2015).

After this research by Volta, many physicists and scientists took advantage of the ‘current

electricity’. The Denmark scientist, Hans Christian Oersted, is one major such scientist. He had

curiosity to find out the connection between electricity and magnetism. Thus, he managed to pass

an electric current through wires. Further, he placed magnets in different positions near the

wires. Hans was able to clarify to his students that flow of current in a wire that is held over a

needle of a magnetic compass at a right angle had no effect on the needle of the compass

(Gooday, 2015).

More exposition into the whole phenomena of electricity came with the American

statesman and scientist, Benjamin Franklin. He carried out an experiment investigating the nature

of lightning and thunder. He did this experiment using a child’s kite on which he tied a string and

attached a metal spike on one end and on the other end, he attached a key. When the string got

soaked with rainwater, there was a downward free flow of electricity through the string.

Consequently, Franklin successfully drew the sparks from the key and made the conclusion that

this kind of electricity and static electricity possessed the same that result from friction (Gooday,

2015).
 Development of Electricity 3

Michael Friday developed this subject further following his 10 years of research. In 1830,

Michael gave a lecture where he made a maiden demonstration of the principle of

electromagnetic induction to his students. He managed to achieve the demonstration using the

powerful electromagnets he constructed that consisted of the coils of wire. He showed that

inducing a current in a neighboring coil was possible through causing the magnetic field lines

that were surrounding one coil to go through a series of rising and falling as the flow of current

was varying. This discovery marked the beginning of the generation of electricity using

mechanical means (Gooday, 2015).

However, it was discovered that it was difficult to generate electricity in direct current

(D.C) form. Thus, the basic generator available could only manage to produce an alternating

flow of current. This generator works by utilizing the properties of magnetism. It functions when

a rotating wire coil in a complete revolution in a field of magnetism that is steady between the

magnetic poles leads to electromotive force (EMF) at the terminals. This EMF goes through a

continuous cycle of rising to a maximum value, falling back to zero, and reverses in the negative

direction where it rises to a maximum value and then falls back to zero. This principle of the

mechanical means of producing electricity is applied in all methods of electricity generation in

high voltages. Regardless of the primary source, the generator must be in the production site for

there to result in a high electric pressure (voltage) available for transmission (Gooday, 2015).

Key actors in the development of electricity

However, electricity received the greatest popularity with Thomas Edison’s invention of

the electric bulb. Edison made it possible for humans to use the incandescent electric light bulb

by the end of the 1870s. He patented this idea and invention in the year 1880. This bulb was
 Development of Electricity 4

better than fire in the sense that it was more consistent, brighter, and safer compared to the

flames of lambs and/or candles. Thus, this bulb marked one of the ways in which electricity was

applicable to modern life. Some of the New York City dwellers were able to illuminate their

homes in the 1880s using Edison’s bulb through pairing it up with small generators. This

discovery was a threat to both the status quo (since people were being introduced to a whole new

form of energy) and to the existing gas lighting industry. Thus, it did not take long before

electricity ceased to be just a science experiment to becoming an exciting, safe, and luxury that

was highly coveted (Gooday, 2015).

However, for longevity and acceptance of electricity among Americans, there was a

demand that new industries come into existence. Primarily, the emerging industries were to

ensure the building of generators that are crucial supplying electric power. Further, there was a

need for industries that could build more electric appliances as well as electric lights that made

use of electricity. Thus, Edison without hesitation launched a business in 1882 that was later

known as General Electric. On the same year, Edison launched the maiden U.S.A central power

plant – the pearl street station in Manhattan.

The use of electricity shifted from small-scale to industrial-scale power when Edison

made a connection of a large generator bank to various consumers within and without New York

City with the introduction of the Pearl Street Station. This station became the model of the power

generation station for the entire power generation industry. The connection of this bank of

generators was made possible through a network of copper wires that were buried underground

since there was not an electric grid in existence.

However, the success of the business was just as important as the success of the

applicability of electricity to human beings in their daily activities. Although Edison was brilliant

with his inventions, he was much disorganized when it came to business matters. He was quick

at inventions than he found financial capital to fund them. Thus, he preferred to focus his efforts

on inventions and let the business part of that work for another person to handle it. Consequently,

his managerial counterpart, Samuel Insull, showed up in the year 1881 (Gomez-Exposito,

Conejo, and Canizares, 2018).

The incoming of Insull to take care of the economics of electricity alongside Edison in

General Electric moved this industry through leaps and bounds. Insull had so much business

prowess that both Edison and General Electric just needed. Following the success of Insull

Edison granted him the power of the attorney over General Electric and the rest of his

businesses. Following this coming together of Edison and Insull, they managed to put up a

flourishing business in the electricity industry over the next four decades.

How the technology can be seen as a system that is not just technological but also social and

organizational

It was discovered that electricity required a different model of business since it was

totally different from almost every other commodity in the market. It required immediate

consumption on production since its storage was, and still is, costly and very limited. Thus, for

accessibility and affordability of electricity, there were need marrying mass efficiencies in both

production and consumption. Thus these were opportunities that presented themselves before

Insull. He had mastered both engineering and the economics of the power grid. Thus almost

every challenge that presented itself was an opportunity in disguise to Insull. However, the major
 Development of Electricity 6

move that indelibly brought change in the electricity industry was when Insull decided to leave

his executive position at General Electric to Chicago Edison that was an electricity generation

and distribution company (Gomez-Exposito, Conejo, and Canizares, 2018). He managed to

achieve economies of scale by managing to close down all small generators and leaving larger

and more efficient units manufactured by General Electric. He also achieved this through

consolidating the major electricity providers. Insull also saw efficiencies in customer sales in that

there was a correlation between the efficient running of the generators and the more number of

customers that he had. Consequently, it was cheaper to run his generators with an increased

number of customers.

Further, for increased efficiency, Insull adopted high-voltage transmission lines in order

to spread electricity to remote areas. Thus, he was able to serve his customers, both within and

without the cities, more efficiently. Insull went further to create new pricing schemes for

electricity that are still relevant today. For instance, the two-part pricing has largely

revolutionized the economics of electricity (Savvy Apps, 2018). Another introduction of Insull

that immensely affected the economics of electricity was the demand charge. Thus, he managed

to profitably include both customers with high demands and low demands of electricity. Insull

also found efficiency in interconnecting power grids. This served to ensure reliability by

enabling power back-up (Gomez-Exposito, Conejo, and Canizares, 2018). Thus, besides

invention, Samuel Insull is considered the greatest mover of electricity.

Relevant factors influencing or hampering the diffusion and adoption of this technology

Despite all these great breakthroughs and achievements in the electricity industry, it was

not without sacrifice and determination. There were a lot of dark horses that were seeking to
 Development of Electricity 7

derail the efforts of major players in the field of electricity development. The major hurdle that

lied on the path of electricity development was politics (Gomez-Exposito, Conejo, and

Canizares, 2018). From the onset, the U.S electricity industry was interlocked with politics. The

opening of the Pearl Street Station was not achieved without Edison having to bribe New York

politicians. However, more challenges arose politically as the electricity industry continued to

grow. It was mandatory for the providers of electricity to receive franchise rights from New York

City officials before serving their customers. This served as an opportunity for politicians to

extort power companies for contributions towards their campaigns as well as personal bribes.

According to (Gomez-Exposito, Conejo, and Canizares, 2018), the pioneers of electricity

also faced to major populist threats emerging from the local government. The first threat was rate

ordinances. This threat could anyhow require rate rollbacks and/or make an imposition of rate

ceilings. Hence it ruined profitability. Secondly, there was the threat of municipalization. This

threat encompassed taking over of private electricity infrastructure investments by local

governments. Insull found a solution to these threats in new legislation that could make a

replacement of the local regulation with the statewide regulation of the electricity industry by

public utility commissions. With challenges in time and public relations, these efforts by Insull

started bearing fruits in 1907 when Wisconsin and New York states led the way of adopting

statewide regulations in the electricity industry.

The biggest challenge in the electricity industry, however, was the Great Depression.

This economic tragedy led to the financial ruin of expanding enterprises of Insull. The collapse

of his indebted company marked the beginning of the legal battles. Insull ended up losing all his

wealth, including the companies he had worked tirelessly to build. He did not just lose his

properties; he also lost his reputation and fell into obscurity.

Role of institutional factors and government intervention in supporting or regulating electricity

However, the fall of Insull was a blessing in disguise for the electricity industry of

America. The federal intervention in this sector went beyond licensing of the hydroelectric

generation that was the mandate of the Federal Power Commission. The Federal Power Act

instructed the Federal Power Commission (now the Federal Energy Regulation Commission,

FERC) to make application of ‘Just and Reasonable’ regulation rate that is based on the cost on

the wholesale market of power. The Public Utility Holding Company Act (1935) was also

enacted requiring the multi-state companies to come up with a way of operating in one state only

(Gomez-Exposito, Conejo, and Canizares, 2018).

The state was also relevant in the 1970s when the energy sector was facing shakings. The

Public Utility Regulatory Policies Act (1978) mandated that the utilities of electricity ought to

buy power from the independent generators. This enactment created a new segment in the

industry as well as opening the door for the intermittent power generation from renewable

sources to enter into the market. There was also legislation that the Congress passed that was

meant to promote environmental goals through curbing electricity use. This decision resulted

from the fear of depleting natural resources as well as the limited energy. In the 1990s, there was

a shift in the federal regulations of electricity towards the approach that was based on the market

(Gomez-Exposito, Conejo, and Canizares, 2018). This approach was aimed at reducing the cost

while at the same time improving the quality of electricity.

Going forward, the federal intervention will continue to influence the development of the

electricity industry of the United States of America. Currently, there are various federal agencies

that have ensured a close check on the electricity industry. The most active agencies consist of
 Development of Electricity 9

FERC, the Environmental Protection Agency, and the Department of Energy. Thus, the success

of the electricity industry of the United States of America will highly depend on the extent of the

intervention of these federal agencies among others.

References

Gomez-Exposito, A., Conejo, A.J. and Canizares, C., 2018. Electric energy systems: analysis and

operation. CRC press.

Gooday, G., 2015. Domesticating electricity: Technology, uncertainty and gender, 1880-1914.

Routledge.

Savvy Apps. (2018). How Much Does an App Cost: A Massive Review of Pricing and other

Budget Considerations. [online] Available at: https://savvyapps.com/blog/how-much-

does-app-cost-massive-review-pricing-budget-considerations [Accessed 29 Nov. 2018].