It Has Been a Long Time

135 years after Thomas Edison formed the Edison Electric Light Company in 1878 and the subsequent patent for an electricity distribution system in 1880, a lot has changed for the electric power industry in the U.S. and the global energy sector in general. The industry has moved from hazardous bare copper wire installations and opportunistic pricing to hazardous market models and manipulated pricing. During this period, access to unfettered amounts of energy has been tremendous for U.S. national security, but at the same time, the wild abandon of energy to the open markets has had just the opposite effect. When charting important U.S. energy market developments from the Progressive Era to present, it becomes clear that the boom and bust cycles that have characterized the industry have had deleterious effects.

Agitated and Motivated: The Progressive Era, 1890s-1920s

Amidst the political agitation of the U.S. Progressive Era, the idea of regulating natural monopolies, including electric utilities, gained momentum as the U.S. became motivated to develop its industrial base and global superiority. In this period, Samuel Insull, who was at one time Edison’s right-hand man, helped usher in the regulation of the industry through utility franchise agreements and business conducted under a cost of service model. Regulations provided the nation with significant economies of scale, as well as energy and transportation security. The central role that electricity played in national security soon led to the federalization of power in 1920 through the Federal Water Power Act. While the original purpose of the Act was to coordinate the development of large hydroelectric projects in the U.S., it also gave the country a massive energy and industrial advantage. The Federal Power Commission would come into being to regulate hydropower dams. The country was on its way to a New Deal.

Below is the timeline of U.S. Power Industry Events and Regulations:

Year Event
1878 Electric Light Company
1880 Electric Distribution System
1920 Federal Water Power Act
1935 Federal Power Act
1935 Public Utility Holding Company Act
1936 Rural Electrification Act
1938 Natural Gas Act
1939 Second World War
1946 Atomic Energy Act
1954 Atomic Energy Act Amended
1965 Northeast Blackout
1968 NERC Reliability Regions
1973 OPEC Oil Crisis
1975 Energy Policy and Conservation Act
1977 Department of Energy Organization Act
1978 National Energy Act
1978 National Energy Conservation Policy Act
1978 Power Plant and Industrial Fuel Use Act
1978 Public Utilities Regulatory Policies Act
1978 Energy Tax Act
1978 Natural Gas Policy Act
1980 Energy Security Act
1980 U.S. Synthetic Fuels Corporation Act
1980 Biomass Energy and Alcohol Fuels Act
1980 Renewable Energy Resources Act
1980 Solar Energy and Energy Conservation Act
1980 Geothermal Energy Act
1980 Ocean Thermal Energy Conversion Act
1982 Nuclear Waste Policy Act
1992 Energy Policy Act
1996 Alberta Power Pool
1996 FERC 888
1998 FASB 133
2000 Tech Bust
2000 California Energy Crisis
2001 911 Terrorist Attack
2001 Enron Scandal
2002 Sarbanes–Oxley Act
2003 War on Iraq
2005 Energy Policy Act
2007 Subprime Crisis
2007 Energy Independence and Security Act (Clean Air)
2008 The Energy and Tax Extenders Act of 2008
2008 Food, Conservation, and Energy Act of 2008
2008 Strategic Petroleum Reserve Fill Suspension and Consumer Protection Act
2008 America COMPETES Act
2008 Energy Improvement and Extension Act of 2008
2009 American Recovery and Reinvestment Act
2010 Dodd-Frank Wall Street Reform and Consumer Protection Act
2011 U.S. Debt Crisis
2012 Clean Energy Standard Act
2013 Fiscal Cliff

Data Sources: ISO/RTO

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