Electricity's Historical Adoption: A Profitable Revolution

how electricity got adopted and increased return

Electricity is an essential part of modern life, and its adoption has grown exponentially over the past century. The first documented mention of electricity dates back to 500 B.C. when Thales of Miletus discovered static electricity. However, it wasn't until the 1600s that English physician William Gilbert published the first theories about electricity. The exploration of electricity intensified in the 1800s, with the development of the telegraph, improvements in electrical generation technology, and the invention of the arc lamp. In the 1880s, the technology for large-scale electricity generation and transmission was commercially developed, and the first American home was powered by hydroelectricity in 1882. The 20th century saw a rapid increase in primary energy use, with electricity becoming the preferred form of energy due to its unique attributes and ability to revolutionize illumination, communication, and manufacturing productivity. The shift towards electrification has continued into the 21st century, with renewable energy sources gaining traction and government policies promoting clean energy and renewable portfolio standards. Today, electricity rates are increasing to cover the investments needed to maintain and expand systems, and there is a growing adoption of electric vehicles and a push towards carbon-free electricity.

Characteristics Values
First discovery of electricity 500 B.C. by Thales of Miletus
First documentation of electricity 1600s by William Gilbert
First power transformer 1881 by Lucien Gaulard and John Dixon Gibbs
First commercial use of hydropower 1882 by Grand Rapids Electric Light and Power Co.
First central DC hydroelectric station 1882 in Appleton, Wisconsin
First solar cell 1882 by Charles Fritts
First electric street car 1881 by Werner von Siemens
First offshore wind farm 1991 in Denmark
First U.S. offshore wind farm 2016 in Rhode Island
Fastest-growing source of electricity in the U.S. Renewable energy
Projected number of electric cars worldwide by 2030 125 million

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The War of the Currents

The AC system was pioneered by British inventor and electrical engineer Sebastian de Ferranti and physicist Lord Kelvin in 1882. It included an early transformer. Arc lighting was capable of lighting streets, factory yards, or the interior of large buildings. It used high voltages (above 3,000 volts) to supply current to multiple series-connected lamps.

The DC system was developed by Thomas Edison, who also invented the world's first practical lightbulb in the late 1870s. Edison's company marketed large-scale, low-voltage DC indoor incandescent lighting. DC runs continually in a single direction, like in a battery or a fuel cell.

In 1886, Edison's system faced competition from an AC system introduced by George Westinghouse's company. AC used transformers to step down from a high voltage so it could be used for indoor lighting. Using high voltage allowed an AC system to transmit power over longer distances from more efficient large central generating stations.

Edison launched a propaganda campaign to discredit AC, claiming it was dangerous. As part of this campaign, animals were publicly electrocuted with AC. He also colluded with Westinghouse's rival, the Thomson-Houston Electric Company, to ensure the first electric chair was powered by a Westinghouse AC generator. However, Edison ultimately failed in his efforts to discredit AC.

In 1893, Westinghouse won the bid to supply electrical power for the World's Columbian Exposition, beating General Electric, which had been formed by a merger involving Edison's company. That same year, Westinghouse also won the major contract to build the Niagara Falls hydroelectric project. In 1896, the plant started delivering electricity to Buffalo, New York, 26 miles away. This achievement was regarded as the unofficial end to the War of the Currents, and AC became dominant in the electric power industry.

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Hydropower

The first industrial use of hydropower to generate electricity in the United States was in 1880 to power 16 brush-arc lamps at the Wolverine Chair Factory in Grand Rapids, Michigan. The first U.S. hydroelectric power plant to sell electricity opened on 30 September 1882 on the Fox River near Appleton, Wisconsin. By 1889, there were 200 hydroelectric power stations in the United States.

To increase capacity in hydropower plants, a mix of large and small turbines can be used to complement variable electricity production from wind power plants. Additionally, pumping water from a lower reservoir to a higher one when the level in the reservoirs drops can increase capacity and readiness for hydropeaking.

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Economic growth

The relationship between electrification and economic growth has been studied extensively, with a strong correlation observed between the two. The efficiency of electricity generation has been linked to technological progress, which has driven economic growth. For example, in the US between 1870 and 1950, there was a significant increase in the amount of horsepower provided per man-hour, indicating an improvement in productivity. The period from 1900 to 1940, when factories and households were being electrified, coincided with high productivity and economic growth.

The adoption of electricity has also been associated with increased conflicts and labour strikes, particularly in sectors with increasing labour demand. This suggests that electrification empowered workers by providing them with a stronger position from which to negotiate and voice their claims.

The development of electricity generation technology in the 19th century significantly improved its efficiency and reliability. By the end of the century, the highest efficiencies were over 90%, compared to only a few per cent at the beginning. This increase in efficiency made electricity a more viable and attractive option for powering economic activity.

The early 20th century saw the widespread adoption of electricity in Sweden, which had a significant impact on its economy. Sweden's lack of domestic coal deposits meant that electrification provided an early and influential shock to the country, driving mechanisation and new ways of organising production. The connection to the state-sponsored electricity grid provided an exogenous impulse for technical change, with parishes connected to the Western Line grid experiencing an increase in strike activity.

The shift towards renewable energy sources, such as wind, solar, and hydropower, has also had economic implications. The oil crisis of the 1970s spurred the development of wind power, with the first utility-scale wind farms appearing in California in the 1980s. The adoption of renewable energy sources can hedge against rising prices and provide a higher return on investment compared to traditional investment vehicles. Additionally, the increasing demand for electricity, driven by the growing use of electric vehicles and "smarter" appliances, will continue to drive economic growth and innovation in the energy sector.

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Labour conflicts

The adoption of electricity during the Second Industrial Revolution in the late 19th century brought about significant technological changes, particularly in Sweden, which had an early and influential experience with electrification. This period saw the widespread use of electricity in manufacturing, communication, and transportation, marking a shift towards mechanization and new ways of organizing production.

The introduction of electricity as a stable source of energy increased the use of motor-driven machinery, potentially reducing the need for manual labour. This technological shift had a notable impact on labour conflicts, with an increase in strikes across various sectors. However, these strikes were not driven by displaced workers but were more common in sectors with increasing labour demand.

The nature of these labour conflicts was predominantly offensive rather than defensive. Workers used their strengthened bargaining position to demand higher wages, shorter working hours, and better working conditions. This suggests that workers were not resisting technological change but were instead leveraging it to improve their employment conditions. The adoption of electricity provided workers with more power to voice their claims, indicating a shift in the balance of power between employers and employees.

While the introduction of electricity during the Second Industrial Revolution did not lead to riots or machine-breaking protests, it did contribute to an increase in local strikes. This contrast with the early 19th century may be due to the availability of good jobs that were relatively easy to acquire during the Second Industrial Revolution. Additionally, increased unionization during this period may have contributed to more organized responses to changes in the labour market.

Furthermore, the impact of electrification extended beyond industrial settings. In rural areas, electrification led to increases in agricultural employment, the rural population, and property values. Over time, rural counties that gained early access to electricity experienced sustained economic growth, outpacing regions that were electrified later.

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Electric vehicles

The Chinese brand is one of the biggest electric vehicle producers in the world, and Norway is one of the top countries scaling electric vehicles. In Norway, eight out of ten passenger car sales in 2022 were electric vehicles, with 150,000 sold in total. This is due to the Norwegian government's deliberate and consistent promotion of EVs, with efforts beginning in 1990, long before the rest of the world. Norway has a target to phase out internal combustion engine vehicle sales by 2025, the earliest of any country.

In the US, electric trucks are becoming increasingly popular, and several manufacturers have announced plans to produce electric versions of their popular models. California's Advanced Clean Cars rule has been adopted by 15 additional states, and the US government has implemented incentives such as the Clean Vehicle Credit.

Artificial intelligence (AI) is another important driver of accelerated EV adoption, optimizing charging station locations, managing energy distribution, and improving battery performance. AI can also help manage the load on the grid, preventing power outages due to high demand from EV charging.

Despite these advancements, there are still challenges to EV adoption. The availability and accessibility of charging stations, inadequate chargers, and complicated payment systems have created "charging anxiety" within the electric car industry. However, the European Union is working to increase the number of public charging points to meet growing demand, and other substantial investments are being made globally to expand EV charging infrastructure.

In the late 19th century, William Morrison, an American chemist and inventor, created the first successful EV. However, EVs did not initially gain traction due to challenges such as limited range, slow speeds, and high production costs. With the discovery of internal combustion engine (ICE) cars around 1860, EVs became nothing more than a brief story of potential. Today, electric vehicles are much more sophisticated, leveraging technology in every part.

Frequently asked questions

Electricity is a part of nature, something that has always existed independent of humans. It is similar to fire in that it was always there, but it was the harnessing of it for our own purposes that was a major step in human development.

The first documentation in the history of electricity dates back to 500 B.C. when Thales of Miletus discovered static electricity by rubbing fur on amber. In 1839, French scientist Edmond Becquerel discovered the photovoltaic (PV) effect. By 1882, the first solar cell was created by New York inventor Charles Fritts. In the 1880s, technology was commercially developed for large-scale electricity generation and transmission.

Electrification and economic growth are highly correlated. The efficiency of electrical generation has been shown to correlate with technological progress. The period of electrification of factories and households from 1900 to 1940 was one of high productivity and economic growth.

The adoption of electricity increased returns by improving efficiency and reliability. The improvements in electrical generation technology in the 19th century increased its efficiency and reliability greatly. By the end of the 19th century, the highest efficiencies were over 90%.

Modern applications of electricity include electric vehicles, solar power, wind power, and hydropower. Electric vehicles operate on DC power, which allows for easy integration of wind and solar energy into the electrical grid. Solar power has been used to power navigation warning lights and horns on offshore gas and oil rigs, lighthouses, and railroad crossing signals.

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