It's a promising new technology, and bright young entrepreneurs are crowding in -- promoting new uses and trying to establish franchises in an industry that promises great wealth for those who succeed. Consumers are tantalized by mesmerizing promises of new ease and new access.

The time is the late 1800s, and the technology is electricity.

Today the electric power industry is as unexceptional as the air we breathe, but in its early days, when firms such as Potomac Electric Power Co. were being born, the business was full of competing egos, stunts intended to dazzle would-be consumers and flailing elbows.

On Sunday, Pepco will be 100 years old. The company is celebrating its centennial at a time when utilities are entering a new era that promises to be as competitive as the times during which the industry was born.

One sign of the changed environment is that next year Pepco and Baltimore Gas & Electric Co. will merge, the better to withstand the challenge from other utilities as gas, electric and local telephone companies emerge into the world of competition from the shelter of monopoly.

It's a world in which Pepco's founders would have been comfortable.

Interest in electricity grew out of development of the telegraph, a half century before Pepco was born.

"People were trained in that technology, and, then, as motors and generators developed, a new group of electricians were ready for the new technology," said Bernard Finn, curator of the electrical collections at the Smithsonian's National Museum of American History.

One of the new technologies was arc lighting -- light generated by a continuous arcing spark between two adjacent pieces of carbon. Arc lighting was great for outdoors, but too hot and too bright for inside.

Showman P.T. Barnum dazzled Washington with a demonstration of arc lighting on April 19, 1879, when he used it to light up the big top of the Great London Circus when it came to town.

That was the same year that Thomas Alva Edison invented the incandescent light bulb, which used a filament heated up to incandescence to provide light. This was an innovation that allowed lighting to be brought indoors.

The electrification of Washington wasn't based on lighting, though. Washington was wired for transportation -- to power the streetcars that powered the city's expansion.

Once the electric lines stretched into new neighborhoods, it was just a matter of time until the power producers began selling new uses.

A group of Washington and Baltimore entrepreneurs seized on the promise of outdoor lighting in 1882, and formed a company called United States Electric Lighting Co. (Uselco).

The group, which included Stilson Hutchins, owner of The Washington Post, held both arc and incandescent lighting licenses, according to a history that Pepco has published for its centennial.

They began installing lights on F Street to promote nighttime business, started to replace gas lights and began laying wire underground in 1884. They hired a canvasser to solicit contracts for lamps and paid a bounty for every six-month lighting contract that he brought in.

They also offered to light Pennsylvania Avenue from the Capitol to the Treasury for free, but the District commissioners turned them down.

In 1885 a fire in the Uselco boiler room wiped out lighting in the city for two weeks, but the company used insurance money to buy out some outside investors and soon began installing new technology. At the same time, it was fighting off efforts by Edison General Electric and a handful of new competitors to horn in on its territory.

One of these interlopers was Potomac Electric Co., organized in 1891 to provide street lighting and streetcar power in Georgetown and Northwest D.C.

Potomac Electric fell into financial troubles during the Panic of 1893 and was taken over and renamed by a Minnesota transportation and utility entrepreneur named Amherst B. Wilder. After he died, the company was acquired by Oscar T. Crosby and Charles A. Lieb for $5,500 on Nov. 6, 1895, according to Pepco archives.

The same month, the two men bought the properties of Col. George Truesdell -- including a railway that ran along New York Avenue, from Fifth Street to Eckington.

They incorporated the Potomac Electric Power Co. on April 28, 1896, as part of Crosby's plan to consolidate the District's 11 street railways and two electric companies, which had been feuding in the courts and elsewhere.

In one of the earliest incidents, Pepco engineer Lindley E. Sinclair had been arrested when he attempted to extend overhead wires through Cleveland Park, where the president of Uselco lived.

Crosby had grown up in the South during Reconstruction. When he was 17, he bought a one-way ticket to West Point to take the examination to be admitted to the U.S. Military Academy there. He graduated second in his class and worked in army engineering until 1887, when he resigned to become superintendent of a railway company. He was 36 when he and Lieb, a Wall Street financier, organized Pepco.

Crosby succeeded in consolidating the District's rail and electric companies into a single powerful company in 1899. He retired from the railway business in 1913, and spent the years until his death in 1947 in Warrenton, writing, traveling, working in diplomacy and studying.

The company he helped create is now the nation's 28th-largest utility in terms of stock value, providing electricity to 678,000 business and residential customers.

After the merger with BGE, the combined company, Constellation Energy Corp., based in Annapolis, will be the nation's ninth-largest -- and ready to meet any interlopers.


1872: Washington witnesses its first demonstration of electric lights.

1879: Thomas Edison invents the incandescent light bulb.

1889: The White House is wired for electric lights and an electric bell system.

Early 1890s: Electric railways begin to replace Washington's horse-drawn streetcar system.

1896: Potomac Electric Co. incorporated into Potomac Electric Power Co.

1905: Pepco revenue surpasses $1 million for the first time.

1920s: Sales of electric appliances such as washing machines, toasters and sewing machines flourish.

1925: Number of meters Pepco runs is up to 100,000.

1933: Pepco and Baltimore Gas & Electric Co. connect their electric systems.

1954: Pepco revenue tops $50 million.

1969: Rising construction costs squeeze earnings; cash dividends suspended.

1980: Pepco's finances improve; it calls 1980 one of company's best years ever.

Late 1980s: Pepco begins preparing for increased electricity demand.

1997: Year targeted for completing merger of Pepco and Baltimore Gas & Electric.

SOURCE: Company reports, International Directory of Company Histories

CAPTION: An advertisement that appeared on the back of a Pepco bill in 1927.