information:classification
Introduction of the transformer

The problem of transmitting electricity over longer distances became a recognized engineering roadblock to electric power distribution, with many less-than-satisfactory solutions tested by lighting companies. But the mid-1880s saw a breakthrough with the development of functional transformers that allowed AC power to be "stepped up" to much a higher voltage for transmission, then dropped down to a lower voltage near the end user. Compared to direct current, AC had much cheaper transmission costs and greater economies of scale — with large AC generating plants capable of supplying whole cities and regions, which led to the use of AC spreading rapidly.

In the US the competition between direct current and alternating current took a personal turn in the late 1880s in the form of a " war of currents " when Thomas Edison started attacking George Westinghouse and his development of the first US AC transformer systems, highlighting the deaths caused by high-voltage AC systems over the years and claiming any AC system was inherently dangerous. Edison's propaganda campaign was short-lived, with his company switching over to AC in 1892.

AC became the dominant form of transmission of power with innovations in Europe and the US in electric motor designs, and the development of engineered universal systems allowing the large number of legacy systems to be connected to large AC grids.

In the first half of the 20th century, in many places the electric power industry was vertically integrated, meaning that one company did generation, transmission, distribution, metering and billing. Starting in the 1970s and 1980s, nations began the process of deregulation and privatization, leading to electricity markets. The distribution system would remain regulated, but generation, retail, and sometimes transmission systems were transformed into competitive markets.