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Electric power industry

The electric power industry covers the generation,
transmission, distribution and sale of electric power to the
general public and industry. The commercial distribution of
electric power started in 1882 when electricity was produced for
electric lighting. In the 1880s and 1890s, growing economic and
safety concerns lead to the regulation of the industry. What was
once an expensive novelty limited to the most densely populated
areas, reliable and economical electric power has become an
essential aspect for normal operation of all elements of
developed economies.

By the middle of the 20th century, electricity was seen as a

"natural monopoly", only efficient if a restricted number of
organizations participated in the market; in some areas,
vertically-integrated companies provide all stages from
generation to retail, and only governmental supervision
regulated the rate of return and cost structure.

Since the 1990s, many regions have broken up the generation

Electric power is transmitted on
and distribution of electric power to provide a more competitive overhead lines like these, and also
electricity market. While such markets can be abusively on underground high-voltage cables
manipulated with consequent adverse price and reliability
impact to consumers, generally competitive production of
electrical energy leads to worthwhile improvements in efficiency. However, transmission and
distribution are harder problems since returns on investment are not as easy to find.

Contents
History
Organization
Generation
Electric power transmission
Electric power distribution
Electric retailing
World electricity industries
Market reform
See also
References
Further reading

History
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Although electricity had been known to be produced as a result

of the chemical reactions that take place in an electrolytic cell
since Alessandro Volta developed the voltaic pile in 1800, its
production by this means was, and still is, expensive. In 1831,
Michael Faraday devised a machine that generated electricity
from rotary motion, but it took almost 50 years for the
technology to reach a commercially viable stage. In 1878, in the
United States, Thomas Edison developed and sold a
commercially viable replacement for gas lighting and heating
Bolsward Substation, the
using locally generated and distributed direct current electricity. Netherlands

The world's first public electricity supply was provided in late

1881, when the streets of the Surrey town of Godalming in the
UK were lit with electric light. This system was powered from a
water wheel on the River Wey, which drove a Siemens alternator
that supplied a number of arc lamps within the town. This
supply scheme also provided electricity to a number of shops
and premises to light 34 incandescent Swan light bulbs.

Additionally, Robert Hammond, in December 1881,

demonstrated the new electric light in the Sussex town of
Brighton in the UK for a trial period. The ensuing success of this
installation enabled Hammond to put this venture on both a Transmission lines in Romania of
commercial and legal footing, as a number of shop owners which the nearest is a Phase
Transposition Tower
wanted to use the new electric light. Thus the Hammond
Electricity Supply Co. was launched.

In early 1882, Edison opened the world's first steam-powered electricity generating station at
Holborn Viaduct in London, where he had entered into an agreement with the City Corporation for a
period of three months to provide street lighting. In time he had supplied a number of local
consumers with electric light. The method of supply was direct current (DC). Whilst the Godalming
and the 1882 Holborn Viaduct Scheme closed after a few years the Brighton Scheme continued on,
and supply was in 1887 made available for 24 hours per day.

It was later on in the year in September 1882 that Edison opened the Pearl Street Power Station in
New York City and again it was a DC supply. It was for this reason that the generation was close to or
on the consumer's premises as Edison had no means of voltage conversion. The voltage chosen for
any electrical system is a compromise. For a given amount of power transmitted, increasing the
voltage reduces the current and therefore reduces the required wire thickness. Unfortunately it also
increases the danger from direct contact and increases the required insulation thickness.
Furthermore, some load types were difficult or impossible to make work with higher voltages. The
overall effect was that Edison's system required power stations to be within a mile of the consumers.
While this could work in city centres, it would be unable to economically supply suburbs with
power.[1]

The mid to late 1880s saw the introduction of alternating current (AC) systems in Europe and the
U.S. AC power had an advantage in that transformers, installed at power stations, could be used to
raise the voltage from the generators, and transformers at local substations could reduce voltage to
supply loads. Increasing the voltage reduced the current in the transmission and distribution lines
and hence the size of conductors and distribution losses. This made it more economical to distribute
power over long distances. Generators (such as hydroelectric sites) could be located far from the
loads. AC and DC competed for a while, during a period called the war of the currents. The DC
system was able to claim slightly greater safety, but this difference was not great enough to
overwhelm the enormous technical and economic advantages of alternating current which eventually
won out.[1]
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The AC power system used today developed rapidly, backed by

industrialists such as George Westinghouse with Mikhail Dolivo-
Dobrovolsky, Galileo Ferraris, Sebastian Ziani de Ferranti, Lucien
Gaulard, John Dixon Gibbs, Carl Wilhelm Siemens, William Stanley,
Jr., Nikola Tesla, and others contributed to this field.

Power electronics is the application of solid-state electronics to the

control and conversion of electric power. Power electronics started with
the development of the mercury arc rectifier in 1902, used to convert
AC into DC. From the 1920s on, research continued on applying
thyratrons and grid-controlled mercury arc valves to power
transmission. Grading electrodes made them suitable for high voltage
direct current (HVDC) power transmission. In 1933, selenium rectifiers
were invented.[2] Transistor technology dates back to 1947, with the
High tension line in
invention of the point-contact transistor, which was followed by the Montreal, Quebec, Canada
bipolar junction transistor (BJT) in 1948. By the 1950s, higher power
semiconductor diodes became available and started replacing vacuum
tubes. In 1956, the silicon controlled rectifier (SCR) was introduced, increasing the range of power
electronic applications.[3]

A breakthrough in power electronics came with the invention of the MOSFET (metal-oxide-
semiconductor field-effect transistor) in 1959. Generations of MOSFETs enabled power designers to
achieve performance and density levels not possible with bipolar transistors.[4] In 1969, Hitachi
introduced the first vertical power MOSFET,[5] which would later be known as the VMOS (V-groove
MOSFET).[6] The power MOSFET has since become the most common power device in the world,
due to its low gate drive power, fast switching speed,[7] easy advanced paralleling capability,[7][8]
wide bandwidth, ruggedness, easy drive, simple biasing, ease of application, and ease of repair.[8]

While HVDC is increasingly being used to transmit large quantities of electricity over long distances
or to connect adjacent asynchronous power systems, the bulk of electricity generation, transmission,
distribution and retailing takes place using alternating current.

Organization
The electric power industry is commonly split up into four processes. These are electricity generation
such as a power station, electric power transmission, electricity distribution and electricity retailing.
In many countries, electric power companies own the whole infrastructure from generating stations
to transmission and distribution infrastructure. For this reason, electric power is viewed as a natural
monopoly. The industry is generally heavily regulated, often with price controls and is frequently
government-owned and operated. However, the modern trend has been growing deregulation in at
least the latter two processes.[9]

The nature and state of market reform of the electricity market often determines whether electric
companies are able to be involved in just some of these processes without having to own the entire
infrastructure, or citizens choose which components of infrastructure to patronise. In countries
where electricity provision is deregulated, end-users of electricity may opt for more costly green
electricity.

Generation

All forms of electricity generation have positive and negative aspects. Technology will probably
eventually declare the most preferred forms, but in a market economy, the options with less overall
costs generally will be chosen above other sources. It is not clear yet which form can best meet the
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necessary energy demands or which process can best solve the

demand for electricity. There are indications that renewable
energy and distributed generation are becoming more viable in
economic terms. A diverse mix of generation sources reduces the
risks of electricity price spikes.

Electric power transmission

Electric power transmission is the bulk movement of electrical

The Athlone Power Station in Cape
energy from a generating site, such as a power plant, to an
Town, South Africa
electrical substation. The interconnected lines which facilitate
this movement are known as a transmission network. This is
distinct from the local wiring between high-voltage substations
and customers, which is typically referred to as electric power
distribution. The combined transmission and distribution
network is known as the "power grid" in North America, or just
"the grid". In the United Kingdom, India, Malaysia and New
Zealand, the network is known as the National Grid.

A wide area synchronous grid, also known as an

500 kV Three-phase electric power
"interconnection" in North America, directly connects many
Transmission Lines at Grand Coulee
generators delivering AC power with the same relative frequency
Dam; four circuits are shown; two
numerous consumers. For example, there are four major
additional circuits are obscured by
interconnections in North America (the Western trees on the right; the entire 7079
Interconnection, the Eastern Interconnection, the Quebec MW generation capacity of the dam
Interconnection and the Electric Reliability Council of Texas is accommodated by these six
(ERCOT) grid). In Europe one large grid connects most of circuits.
continental Europe.

Historically, transmission and distribution lines were owned by the same company, but starting in
the 1990s, many countries have liberalized the regulation of the electricity market in ways that have
led to the separation of the electricity transmission business from the distribution business.[10]

Electric power distribution

Electric power distribution is the final stage in the delivery of electric

power; it carries electricity from the transmission system to individual
consumers. Distribution substations connect to the transmission
system and lower the transmission voltage to medium voltage ranging
between 2  kV and 35  kV with the use of transformers.[11] Primary
distribution lines carry this medium voltage power to distribution
transformers located near the customer's premises. Distribution
transformers again lower the voltage to the utilization voltage used by
lighting, industrial equipment or household appliances. Often several
customers are supplied from one transformer through secondary
distribution lines. Commercial and residential customers are connected
to the secondary distribution lines through service drops. Customers
demanding a much larger amount of power may be connected directly
to the primary distribution level or the subtransmission level.[12] A 50 kVA pole-mounted
distribution transformer

Electric retailing

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Electricity retailing is the final sale of electricity from generation to the end-use consumer.

World electricity industries

The organization of the electrical sector of a country or region varies depending on the economic
system of the country. In some places, all electric power generation, transmission and distribution is
provided by a government controlled organization. Other regions have private or investor-owned
utility companies, city or municipally owned companies, cooperative companies owned by their own
customers, or combinations. Generation, transmission and distribution may be offered by a single
company, or different organizations may provide each of these portions of the system.

Not everyone has access to grid electricity. About 840 million people (mostly in Africa) had no access
in 2017, down from 1.2 billion in 2010.[13]

Market reform
The business model behind the electric utility has changed over the years playing a vital role in
shaping the electricity industry into what it is today; from generation, transmission, distribution, to
the final local retailing. This has occurred prominently since the reform of the electricity supply
industry in England and Wales in 1990. In some countries, wholesale electricity markets operate,
with generators and retailers trading electricity in a similar manner to shares and currency. As
deregulation continues further, utilities are driven to sell their assets as the energy market follows in
line with the gas market in use of the futures and spot markets and other financial arrangements.
Even globalization with foreign purchases are taking place. One such purchase was when the UK's
National Grid, the largest private electric utility in the world, bought New England’s electric system
for $3.2 billion.[14] Between 1995 and 1997, seven of the 12 Regional Electric Companies (RECs) in
England and Wales were bought by U.S. energy companies.[15] Domestically, local electric and gas
firms have merged operations as they saw the advantages of joint affiliation, especially with the
reduced cost of joint-metering. Technological advances will take place in the competitive wholesale
electric markets, such examples already being utilized include fuel cells used in space flight;
aeroderivative gas turbines used in jet aircraft; solar engineering and photovoltaic systems; off-shore
wind farms; and the communication advances spawned by the digital world, particularly with
microprocessing which aids in monitoring and dispatching.[16]

Electricity is expected to see growing demand in the future. The Information Revolution is highly
reliant on electric power. Other growth areas include emerging new electricity-exclusive
technologies, developments in space conditioning, industrial processes, and transportation (for
example hybrid vehicles, locomotives).[16]

See also
AC power
Distributed generation
Emissions & Generation Resource Integrated Database
Meter Point Administration Number, a unique UK supply number
National Grid (disambiguation)
North American Electric Reliability Corporation
Rate Case
Reddy Kilowatt, a U.S. electricity corporate logo
Samuel Insull

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References
1. Shock and Awe: The Story of Electricity – 2. The Age of Invention
2. Thompson, M.T. "Notes 01" (http://www.thompsonrd.com/NOTES%2001%20INTRODUCTION%
20TO%20POWER%20ELECTRONICS.pdf) (PDF). Introduction to Power Electronics. Thompson
Consulting, Inc.
3. Kharagpur. "Power Semiconductor Devices" (http://nptel.iitm.ac.in/courses/Webcourse-contents/I
IT%20Kharagpur/Power%20Electronics/PDF/L-1(SSG)(PE)%20((EE)NPTEL).pdf) (PDF). EE IIT.
Archived (https://web.archive.org/web/20080920222959/http://nptel.iitm.ac.in/courses/Webcours
e-contents/IIT%20Kharagpur/Power%20Electronics/PDF/L-1(SSG)(PE)%20((EE)NPTEL).pdf)
(PDF) from the original on 20 September 2008. Retrieved 25 March 2012.
4. "Rethink Power Density with GaN" (https://www.electronicdesign.com/power/rethink-power-densi
ty-gan). Electronic Design. 21 April 2017. Retrieved 23 July 2019.
5. Oxner, E. S. (1988). Fet Technology and Application (https://books.google.com/books?id=0AE-0
e-sAnsC&pg=PA18). CRC Press. p. 18. ISBN 9780824780500.
6. "Advances in Discrete Semiconductors March On" (https://www.powerelectronics.com/content/ad
vances-discrete-semiconductors-march). Power Electronics Technology. Informa: 52–6.
September 2005. Archived (https://web.archive.org/web/20060322222716/http://powerelectronic
s.com/mag/509PET26.pdf) (PDF) from the original on 22 March 2006. Retrieved 31 July 2019.
7. "Power MOSFET Basics" (http://www.aosmd.com/res/application_notes/mosfets/Power_MOSFE
T_Basics.pdf) (PDF). Alpha & Omega Semiconductor. Retrieved 29 July 2019.
8. Duncan, Ben (1996). High Performance Audio Power Amplifiers (https://archive.org/details/highp
erfomanceau0000dunc/page/178). Elsevier. pp. 178–81 (https://archive.org/details/highperfoman
ceau0000dunc/page/178). ISBN 9780080508047.
9. "The Bumpy Road to Energy Deregulation" (https://www.en-powered.com/blog/the-bumpy-road-t
o-energy-deregulation). EnPowered. 2016-03-28.
10. "A Primer on Electric Utilities, Deregulation, and Restructuring of U.S. Electricity Markets" (http
s://www.pnnl.gov/main/publications/external/technical_reports/PNNL-13906.pdf) (pdf). United
States Department of Energy Federal Energy Management Program (FEMP). May 2002.
Retrieved October 30, 2018.
11. Short, T.A. (2014). Electric Power Distribution Handbook. Boca Raton, Florida, USA: CRC Press.
pp. 1–33. ISBN 978-1-4665-9865-2.
12. "How Power Grids Work" (http://science.howstuffworks.com/environmental/energy/power5.htm).
HowStuffWorks. Retrieved 2016-03-18.
13. Closing Sub-Saharan Africa’s Electricity Access Gap: Why Cities Must Be Part of the Solution (ht
tps://www.wri.org/blog/2019/08/closing-sub-saharan-africa-electricity-access-gap-why-cities-must
-be-part-solution)
14. SEC filing dated March 15, 2000 (https://www.sec.gov/rules/other/35-27154.htm)
15. "Electricity companies in the United Kingdom – a brief chronology," Electricity Association, 30
June 2003 (http://www.privatizationbarometer.com/PUB/RD/1/9/3/ElectricityChronology.pdf)
16. Borberly, A. and Kreider, J. F. (2001). Distributed Generation: The Power Paradigm for the New
Millennium. CRC Press, Boca Raton, FL. 400 pp.

Further reading
P. Strange, "Early Electricity Supply in Britain: Chesterfield and Godalming", IEEE Proceedings
(1979).
D. G. Tucker, "Hydro-Electricity for Public Supply in Britain", Industrial Archaeology Review,
(1977).
B. Bowers, A History of Electric Light & Power, Peregrinus (1982).
T. P. Hughes, Networks of Power, Johns Hopkins Press London (1983).

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IRENA, INNOVATION LANDSCAPE FOR A RENEWABLE-POWERED FUTURE: SOLUTIONS

TO INTEGRATE VARIABLE RENEWABLES (https://cms.irena.org/publications/2019/Feb/Innovat
ion-landscape-for-a-renewable-powered-future), (2019).

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