Further Consolidation and Expansion Pacific Gas and Electric Company

pg&e general office building in san francisco

within few years of incorporation, pg&e made significant inroads northern california s hydroelectric industry through purchase of existing water storage , conveyance facilities. these included many reservoirs, dams, ditches , flumes built mining interests in sierras no longer commercially viable. 1914, pg&e largest integrated utility system on pacific coast. company handled 26 percent of electric , gas business in california. operations spanned 37,000 square miles across 30 counties.

the company expanded in 1920s through strategic consolidation. important acquisitions during period included california telephone , light company, western states gas , electric company , sierra , san francisco power company, provided hydropower san francisco s streetcars. these 3 companies added valuable properties , power , water sources. end of 1927, pg&e had 1 million customers , provided electricity 300 northern californian communities.

in 1930, pg&e purchased majority stock holdings in 2 major californian utility systems—great western power , san joaquin light , power—from north american company, new york investment firm. in return, north american received shares of pg&e s common stock worth $114 million. pg&e gained control of 2 smaller utilities, midland counties public service , fresno water company, later sold. acquisition of these utilities did not result in immediate merger of property , personnel. great western power company , san joaquin company remained separate corporate entities several more years. through final major consolidation, pg&e served of northern , central california through 1 integrated system.

natural gas

the gas industry market structure dramatically altered discovery of massive natural gas fields throughout american southwest beginning in 1918. fuel cleaner manufactured gas , less expensive produce. while natural gas sources abundant in southern california, no economical sources available in northern california. in 1929, pg&e constructed 300-mile pipeline kettleman oil field bring natural gas san francisco. city became first major urban area switch manufactured gas natural gas. transition required adjustment of burners , airflow valves on 1.75 million appliances. in 1936, pg&e expanded distribution additional 45-mile pipeline milpitas. pg&e gradually retired gas manufacturing facilities, although plants kept on standby.

defense activities boosted natural gas sales in california during world war ii, cut state s natural reserves. in 1947, pg&e entered contract southern california gas company , southern counties gas company purchase natural gas through new 1,000-mile pipeline running texas , new mexico los angeles. agreement reached el paso natural gas company of texas gas delivery california-arizona border. in 1951, pg&e completed 502-mile main connected el paso network @ state line.

during period of expansion pg&e involved in legal proceedings securities , exchange commission regarding company s status subsidiary of north american company. outlined public utility holding company act of 1935, utility subsidiary defined utility company more 10% of stock held public utility holding company. though 17% of pg&e stock held north american company @ time, pg&e filed sec exempted subsidiary status on grounds 17% ownership did not give north american company control , because north american company occupied 2 board member spots. north american company backed pg&e s request stating involved in business operations in limited capacity. request remained unresolved until 1945 when north american company sold off stocks brought ownership below 10%. sec ruled pg&e not subsidiary of north american company. in 1948, north american company sold remaining stock in pg&e.