From Edison to Enron


From Edison to Enron: The Business of Power and What It Means for the Future of Electricity
by Richard Munson

Main Points:

  • The United States electric grid currently faces several problems: deregulation vs. regulated monopolies, distributed generation vs. central generation and distribution, wastage/leakage, and political barriers to adopting new technologies. From Edison to Enron takes us through the famous battles in the electric grid's founding: Westinghouse/Tesla vs. Edison, Samuel Insull vs. George Norris/FDR, and more. 
  • Interesting to note that J.P. Morgan played a critical role in the leadership and control of the major initial utilities General Electric and Consolidated Edison. For General Electric, J.P. Morgan removed Thomas Edison from the company by forcing a merger between the Edison Electric company and Thomson-Houston, adopting AC current, and formally creating General Electric. In the case of Consolidated Edison, after the 1931 panic when the United Kingdom left the gold standard, the utilities faced a crash in their stock price. The result was an opportunity for JP morgan to claim control of the midwestern power assets- which he did by arranging an audit of the utility's investment trust, accusing Insull of embezzlement, and preventing other bankers from covering a $20 million note. Having lost his money and his company, Insull left the country. JP Morgan pushed out both Thomas Edison and Samuel Insull from the electric industry, both men who he offered loans before.
  • Technology is rapidly changing in the electric industry: cogenerators, combined cycle gas turbines, pebble bed modular reactors, proton exchange membranes (PEM) for fuel cells, along with PV's, wind turbines, and more. However several barriers still remain in the way of progress- dominant power companies limit competition by preventing entities from connecting to the grid, states ban independent wiring, stranded costs are recovered by exit fees, and the Clean Air Act of 1970 exempts existing electric generating plants from stringent air-pollution rules so only new generators are subject to these emission reduction regulations. 

Visit Richard Munson's personal page to read more of his books! A new book is out on Nikola Tesla!

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