Power, Pyramids, and the Price of Light

Written by: Jay Sikora

Edited by: William Gizzi

Before there were data networks, there were power lines. Before the tech titans of Silicon Valley, there were the electric kings of Wall Street—barons not of bandwidth, but of voltage, leverage, and scale. They didn’t just power homes. They built empires, layered in stock and secrecy, humming beneath the surface of the American dream.

This book is the story of those empires—how they rose, how they fell, and how their DNA still pulses through our modern economy.

Between 1905 and 1935, a new kind of corporate colossus emerged in the United States: the electric utility holding company. These weren’t traditional power companies. They didn’t generate electricity. They owned the companies that did—and they owned the companies that owned those companies, in pyramids of stock control so steep and opaque that even regulators couldn’t see the top.

At the center stood names like EBASCO, Middle West Utilities, North American Company, and Associated Gas & Electric. Men like Samuel Insull, Howard Hopson, and Sidney Z. Mitchell controlled power not through force, but through finance—crafting elaborate corporate structures that defied gravity, logic, and eventually, the law.

Their reach was continental. Their ambition, imperial.

And then came the fall.

The Great Depression cracked the mirrors. The Senate hearings lit the corridors. And in 1935, Congress passed the Public Utility Holding Company Act, shattering the pyramids and ending the era of empire.

But the echoes remain. In today’s utility companies. In corporate conglomerates. In the quiet assumption that complexity is efficiency, and opacity is innovation.

This is not just a story of electricity. It’s a story of power—how it concentrates, how it escapes scrutiny, and how it must be reckoned with before it burns us all.

Table of Contents

Chapter 1 – The Taming of the Current (1905–1915) The birth of the electric holding company and the invention of financial control over infrastructure.

Chapter 2 – The Empire Builders (1915–1929) Insull, EBASCO, and the rise of pyramid-shaped corporate empires.

Chapter 3 – House of Mirrors (1929) The structures behind the scenes—and the illusions that powered them.

Chapter 4 – The Great Unraveling (1929–1932) Collapse, confusion, and the human cost of unregulated monopoly.

Chapter 5 – Senate on Fire (1932–1935) Hearings, headlines, and the explosive investigations that rocked the industry.

Chapter 6 – PUHCA and the End of the Empire (1935–1939) The Public Utility Holding Company Act and the surgical dismantling of financial empires.

Chapter 7 – Echoes in the Grid (1940–Present) How the fragments of broken empires became the foundations of today’s utilities.

Epilogue – The Ghost in the Wire What the rise and fall of electric holding companies still teaches us about power, complexity, and memory.

Chapter 1 – The Taming of the Current (1905–1915)

Where empires begin with sparks and signatures.

The storm had already come and gone by 1905. Lightning—the real kind, heaven-born and indifferent—had been conquered, bottled, and brokered by men. No longer a god’s weapon, it now answered to switches and stocks. And with that transformation, a new kind of dominion began—not over nations, but over voltage, venture, and value.

It was the dawn of the age of electric empire.

At the heart of this transformation stood a curious paradox: electricity, that most ephemeral force, required the heaviest infrastructure mankind had yet built. Steel towers and turbines. Copper veins buried beneath the cities. Vast coal furnaces roaring like ancient beasts. And yet none of this—the substations, the substantiated—would ever work without the invisible scaffolding of capital.

And so, from the heart of Schenectady, from the minds that had wrought General Electric, there emerged a new creation. Not an invention of circuits, but of strategy. A corporation designed not to generate power, but to generate control.

Electric Bond and Share Company—EBASCO—was born.

A Holding Company, Held Like a Weapon

It was a subtle magic, what EBASCO brought to the table. No smokestack, no turbine. No electric hum on the wind. Just paperwork, and the cunning to use it.

GE, already the manufacturer of the machines that made the current run, now found a way to ensure that every wire and watt flowed through companies it helped finance—and later, own. EBASCO was their armature, conducting not electricity but influence.

Through EBASCO, General Electric could offer small utilities the capital they needed—but at a price: equity, oversight, and eventually, ownership. In time, EBASCO was not merely a lender but a landlord. A spider at the center of a dazzling web of regional utilities, each one seemingly independent, but tethered back to the same golden core.

And it worked. Oh, how it worked.

The First Webs of Power

Between 1905 and 1915, EBASCO spread like ivy over a trellis. Quietly. Organically. In every corner of America where a village flickered with new electric light, chances were good that somewhere in the paperwork, Electric Bond and Share had signed the loan, chosen the directors, or named the price.

It wasn’t the only one. Samuel Insull, the wizard of the Midwest, was drawing his own diagrams in the dark, building out Middle West Utilities in an equally ambitious sweep. While EBASCO worked east to west, Insull moved with a merchant’s instinct, buying up utilities like a collector of rare coins—each one precious, each one a stepping-stone to a continent-wide empire.

And they weren’t alone. Wall Street was waking up to a new kind of asset: monopolies with meters, guaranteed returns measured in kilowatt-hours. Investors saw not just growth, but governance. Electricity was no longer just an industry; it was an ecosystem—and the holding company was its alpha predator.

A New Kind of Map

These companies didn’t think in towns or counties. They thought in circuits and control zones, in load curves and capital flows. They laid down networks, not roads, and connected cities not by rails, but by the quiet hum of high-voltage lines.

By 1915, America was becoming something strange and new—a land lit up by a private aristocracy of utility barons, each more powerful than the last, each with their own lattice of subsidiaries and boards. The companies they held had names like Empire Electric, Consolidated Power, National Light & Traction—names full of patriotic thunder, but all answering to just a handful of corporate masters.

“It was not Washington, nor the statehouse,” wrote a contemporary critic, “but the boardroom in New York where the price of light and heat was decided.”

Wires and Warnings

Even then, there were murmurs. Whispers of too much power, too few hands. Of pyramid schemes made of subsidiaries. Of control so layered it could not be traced, let alone untangled. Regulators blinked at the filings. Congress raised an eyebrow. But nothing slowed the surge.

Because the light was too beautiful. Too necessary. America was electrifying its cities, its factories, its dreams—and it needed capital to do so. Capital flowed best through these great holding companies. And those who tried to resist the current?

They were left in the dark.

Chapter 2 – The Empire Builders (1915–1929)

Of magnets and monopolies, of boardrooms that bent rivers and remade regions.

They built not cities, but systems. They laid no bricks, but signed the deeds to towns. They did not generate electricity—but they decided who did. They were the empire builders, and their raw material was influence.

Between 1915 and 1929, a new breed of corporate architect rose to power. Not inventors. Not industrialists. But financial engineers, who learned to twist the wires of corporate structure into something more potent than a turbine: the holding company pyramid.

And no man mastered this art more completely than Samuel Insull.

The Wizard of the Middle West

If Thomas Edison gave light to the people, Samuel Insull gave it permanence. A former Edison secretary turned electric monarch, Insull did not just dream in grids—he built them. In the corn-fed heart of Illinois, he conjured an empire that would stretch from Chicago to the farthest prairies of Nebraska and Missouri.

His method was both simple and sublime.

Step one: Acquire a profitable utility. Step two: Create a new company to hold it. Step three: Use the parent’s paper wealth to acquire two more. Step four: Repeat until the flow of power—electric and political—ran one way: up.

By the late 1920s, his Middle West Utilities Company—a name bland enough to be overlooked—controlled hundreds of companies across 32 states, with direct or indirect reach to one-eighth of the American population. From Commonwealth Edison in Chicago to the electric railway systems of Milwaukee, from Oklahoma Gas & Electric to Iowa Public Service, Insull’s reach was as wide as any rail baron or robber baron of the Gilded Age.

But unlike the steel tycoons or oil kings, Insull’s tool wasn’t fire or iron—it was debt. Structured. Layered. Weaponized.

“Give me a monopoly and I’ll give you a stable rate,” he declared—half promise, half prophecy.

The House That GE Built

Meanwhile, to the east, another force grew in parallel.

Electric Bond & Share Company, EBASCO, continued to sprawl. Born as a financing arm of General Electric, by the 1920s it had become a colossus in its own right—owning or controlling utilities in nearly every U.S. state, plus a portfolio that reached into Latin America and Canada.

It was the quiet giant. Less flamboyant than Insull. Less theatrical. But in sheer scope, EBASCO rivaled any empire.

Through its subsidiaries like American Power & Light, it reached into Florida, Louisiana, Iowa, Texas. It owned Florida Power & Light, Louisiana Power & Light, and pieces of countless others. And because EBASCO was seeded with General Electric capital, it also ensured that GE equipment—turbines, transformers, meters—would dominate the marketplace.

A virtuous circle for investors. A closed loop for everyone else.

The Age of Consolidation

This was a time of mergers, not mortar. The big got bigger—not by building new plants, but by buying those who already had them.

• North American Company, backed by J.P. Morgan Jr, absorbed Pacific Gas & Electric, Detroit Edison, and pieces of the Wisconsin Electric empire.

• Commonwealth & Southern, with ties to both Insull and Wall Street, created a vast Southern network—Alabama Power, Georgia Power, Mississippi Power—that would one day form the backbone of today’s Southern Company.

• Associated Gas & Electric, under the shadowy and brilliant Howard Hopson, assembled a vast patchwork of East Coast and Midwest utilities.

By 1927, just three holding companies controlled 45% of the U.S. electric utility industry.

It was a mosaic held together by stock pyramids, cross-owned subsidiaries, and interlocking boards of directors. Like a gothic cathedral built from paperwork, the higher one looked, the more dizzying the structure became.

Power Beyond Wires

These men—Insull, Hopson, Mitchell—did not merely build companies. They influenced policy, shaped public opinion, and wrote the economic rules of the regions they served.

They formed trade associations to lobby Congress.

They flooded newspapers with cheerful editorials about the virtues of private power.

They invited regulators to tour shiny new plants while quietly denying electricity to unprofitable rural regions.

And all the while, their stock tickers danced.

The market adored them. These were “safe” investments. Utilities never went out of style. People always needed light. What could go wrong?

The Icarus Curve

By the end of the 1920s, America’s electric grid was a marvel of modern civilization—but also a trap.

• Rates were rising faster than incomes.

• Rural America remained largely in the dark—literally and metaphorically.

• And most damning: no one truly understood who owned what. Subsidiary owned subsidiary owned holding company owned the bank that underwrote it all.

It was a house of mirrors—profitable, prestigious, and perilously perched.

And then came the spark that would bring the storm.

Chapter 3 – House of Mirrors (1929)

Where the books glistened with profits, and the truth was buried in footnotes.

The lights never flickered. Not in the boardrooms. Not in the towers. Not in the elegant columns of earnings stamped into annual reports and mailed to stockholders with the confidence of a Roman edict. In 1929, America’s electric utilities were not just healthy—they were heroic.

Profits climbed. Stocks soared. Consumers kept plugging in. Cities glowed brighter than ever before. And in the fluorescent sheen of progress, few paused to ask: who really owns the power?

Because if they had looked—looked closely—they would have seen a labyrinth.

Not of wires, but of ownership.

Not of plants and poles, but of paper promises, strung together in pyramids so complex, even their architects sometimes lost count.

This was the world of the holding company, perfected.

The Pyramid Scheme with Real Turbines

In theory, the structure was elegant. A holding company—say, Middle West Utilities—would own several regional utilities. Those utilities might own smaller operating companies. Those, in turn, might own their own service providers: billing firms, coal contracts, real estate holding outfits. Every layer owned the one below it, and every layer could issue stock.

But here’s the trick: the man at the top—Samuel Insull, for example—might own just 5% of the top company, which in turn owned 51% of the next, which controlled 80% of the one below, and so on. By the fifth or sixth layer, a few thousand dollars at the top could command millions at the bottom.

This was called a “pyramidal structure,” and it was not illegal. It was… ingenious.

“Leverage wasn’t just a tool,” one journalist wrote. “It was a religion.”

Profits in the Eye of the Beholder

Holding companies didn’t need to generate electricity. They generated returns—or the illusion of them.

They did this by:

• Issuing stock in subsidiary companies.

• Using the proceeds to pay dividends on the parent company’s stock.

• Repeating the cycle, often using intercompany loans or even consumer payments to prop up the financial pyramid.

Each level seemed profitable. Each report glowed. But the profits were often the same dollars being passed up and down like water in a bucket brigade—only faster.

In today’s terms, it was part utility, part private equity, part Ponzi scheme.

The Books Were Cooked in Layers

Let’s take Associated Gas & Electric (AG&E), run by the cunning Howard Hopson.

By 1929, AG&E claimed to serve over a million customers through 250 subsidiaries. It listed assets of over $1 billion. Hopson, once a minor utility manager, now controlled an empire across the Northeast and Midwest.

But behind the glowing reports lay:

• Cross-company leases that moved profits without real transactions.

• Loans from operating utilities to parent companies.

• Dividend payouts funded by borrowing, not earnings.

The companies looked good—because they were paying themselves.

And no one knew how deep the pyramid really went. Not even the regulators. Especially not the investors.

The Market Loved It

On Wall Street, utility stocks were the gold standard.

They offered dividends, stability, and the promise of eternal demand—because who, after all, would stop needing electricity?

From 1925 to 1929, utility stocks more than doubled in value. Insull’s securities were traded like blue chips. EBASCO’s portfolio was seen as a safe haven for widows and institutions alike.

Even banks invested. Even cities bought in. Everyone wanted a piece of the wire.

And the holding companies responded—by issuing more stock, more debt, more promise.

“It was not greed,” one financier later admitted. “It was belief. And belief unchecked becomes blindness.”

The System Begins to Groan

In late 1929, the market trembled. Steel fell. Railroads sagged. But the utilities held strong… for a moment.

Then a whisper spread: Insull was overextended. He had too many layers. Too many debts.

A single investor—unable to trace the value of the paper in his hands—sold.

Then another. Then a thousand more.

By October, Insull’s empire was teetering. AG&E’s books were under scrutiny. EBASCO’s share prices began to sag.

The mirrors were cracking.

And the light—the very light that electrified a nation—was being dimmed by shadows no one could explain.

Nobody Knew Who Owned What

At the height of the bubble:

• A single utility might appear on five different balance sheets.

• Consumer rates were rising to fund investor dividends, not operations.

• Regulators were told: “It’s too complex for public understanding.”

And that was true. But it was also the point.

Complexity was a moat. Opacity was a strategy.

Until the day it became a noose.

Chapter 4 – The Great Unraveling (1929–1932)

When the towers of finance trembled and the empire builders faced their reckoning.

At first, there was denial.

The lights were still on. The factories still ran. Streetcars clanged across the cobbled hearts of America’s cities, and homes still crackled with the soft blue hiss of electric lamps. From the top floors of holding company headquarters, the world still looked orderly—if a little shaken.

But beneath the marble and glass of those offices, the foundations were splintering.

This wasn’t a market correction. It was the collapse of the illusion that had powered the electric empire. The pyramid had grown too tall. The mirrors had bent too far. And when Wall Street fell in October of 1929, it did not just pull down the flimsy. It pulled down the mighty.

The Fall of the House of Insull

Samuel Insull had been called many things: a genius, a monopolist, a visionary. By 1930, he was called something new:

“Overleveraged.”

His Middle West Utilities empire, once the shining star of Chicago finance, had become a Rube Goldberg machine of cross-holdings and paper profits. The moment investors stopped believing in its structure, the structure ceased to exist.

• Share prices dropped 90%.

• Subsidiaries defaulted on loans—to each other.

• Ratepayers, promised stable service, saw outages and rising bills.

In July 1932, Middle West Utilities collapsed into receivership. At least 600 companies were affected. Banks called in debts. Cities sued. Customers protested.

Insull fled to Europe. Chicago, once his crown, now whispered his name like a curse.

“He promised us light,” said one tenant, “and left us with shadows.”

Fraud, Fiction, and the Fall of AG&E

If Insull built his empire on ambition, Howard C. Hopson built his on deceit.

Hopson’s Associated Gas & Electric (AG&E) had always been a mystery, even to those inside it. He controlled over 250 companies, served millions, and claimed assets over a billion dollars.

But by 1932, the auditors came calling.

They found:

• Falsified earnings reports

• Fictitious intercompany revenues

• A private slush fund used to bribe lawmakers and influence rate commissions

Hopson had even hired psychiatrists to discredit his critics. And while his shareholders begged for transparency, he spent company money on yachts and ghostwriters.

When AG&E collapsed, it became one of the largest bankruptcies in American history. Hopson would later be convicted of mail fraud and tax evasion.

The man who had once lit cities now sat in silence, behind bars.

EBASCO and the Ghost of General Electric

Even Electric Bond & Share, once GE’s golden goose, found itself wobbling.

Though it survived the worst of the crash, its web of subsidiaries—including American Power & Light, Florida Power & Light, and dozens of others—was no longer admired. It was feared.

Investors began asking hard questions:

• Why were dividends still being paid?

• Who approved the loans between companies?

• What exactly was GE’s role?

Under pressure from Congress and regulators, General Electric began selling off its stake. By 1933, the divorce was nearly complete. EBASCO, stripped of its prestige and protective parent, began to resemble all the other toppled giants.

No longer a titan. Just a tangle.

The Human Cost

It wasn’t just financiers who paid the price.

• Thousands of workers lost their jobs—engineers, linemen, meter readers, office clerks.

• Towns that had once been proud to host new substations now saw power rationed and maintenance deferred.

• Elderly stockholders saw lifetime savings vaporized in a matter of months.

One widow in Iowa wrote to her senator:

“We invested in American Light and Heat because it said ‘guaranteed by Middle West.’ Now the bank says that means nothing. I cook with wood again.”

And always, the same question echoed: “How could this happen?”

Enter the Investigators

In Washington, a slow fire was building.

The Senate launched a series of hearings—later known as the Wheeler-Rayburn Investigations—to understand just how these towers had been built, and why they had fallen.

They subpoenaed executives. They read the ledgers. They diagrammed the pyramids in public testimony. America watched, riveted, as men who had once walked above the law were made to explain their math under oath.

And behind the questions loomed another force: President Franklin Delano Roosevelt, who saw in the wreckage an opportunity to do what his cousin Theodore had once done to the trusts.

Only this time, the railroads weren’t the enemy.

The wires were.

Chapter 5 – Senate on Fire (1932–1935)

Where wire met gavel, and the gods of power stood trial.

The power brokers had reigned in silence, above the clamor of the public square. But now the wires they strung across a continent began to hum with a new kind of electricity—anger.

The names once spoken with reverence—Insull, Hopson, Mitchell—now hung like acrid smoke over Senate chambers. The lights in America still glowed, but faith in those who had lit them had gone out.

And so came the reckoning.

It began with a question, posed not by an economist or executive, but by a farmer in Nebraska:

“Why is my bill going up while their dividends go down?”

The answer led to a stage—the United States Senate—and a performance the likes of which the utility world had never seen.

The Wheeler-Rayburn Hearings Begin

In 1932, under mounting public pressure, Congress convened what would become one of the most explosive corporate investigations in American history.

The Senate’s Special Committee to Investigate Holding and Operating Companies of Electric and Gas Utilities—known more simply as the Wheeler-Rayburn Committee—opened its books, its subpoenas, and its jaws.

The aim was simple: Trace the flow of power. Not the electric kind, but the financial kind.

And what they found was astonishing.

A Maze of Mirrors

One by one, the witnesses came forward.

• Executives who could not name all the subsidiaries they controlled.

• Accountants who explained that the same dollar had been counted five times on five different balance sheets.

• Secretaries who revealed that consumer rate hikes had been approved to cover stock dividends, not operating costs.

The committee discovered:

• Dividend payouts made with borrowed funds.

• Inflated asset values that doubled or tripled a company’s “worth” overnight.

• Utility holding companies that used operating subsidiaries as piggy banks, bleeding them dry to prop up share prices.

“This is not capitalism,” thundered Senator Burton K. Wheeler. “This is cannibalism—with the public on the menu.”

The Public Watches

The hearings were broadcast live, and newspapers printed the testimony almost verbatim.

Americans, many still lighting their homes with kerosene in rural towns untouched by the grid, now saw how their electricity bills were funding yachts, mistresses, and Madison Avenue offices.

Cartoons showed utility executives as plump spiders spinning webs of wire. Editorials demanded action.

And in the homes of investors—widows, veterans, teachers—there was rage. Because the bonds they had bought, stamped with names like “Middle West Utilities” or “American Power & Light,” were now worth less than the paper they were printed on.

The Cases that Shook the Empire

• Howard Hopson, of AG&E, was exposed as a fraud of the highest order. He had manipulated earnings, bribed lawmakers, and used his corporate fleet to ferry politicians to private resorts. His conviction would come later—but his reputation was dead on arrival.

• Samuel Insull, extradited from Europe, faced trial as the man who had built an empire on confidence and collapsed it with leverage. Though eventually acquitted of criminal fraud, his legacy lay in ruins. His dream of a nationwide grid, privately owned and governed by trust, now looked like delusion.

• EBASCO, though never convicted of criminal misconduct, was revealed as a machine of complexity, impossible to regulate and dangerous to ignore. Its tentacles reached across the nation and the hemisphere. The question was no longer what it owned, but how it could be stopped.

The Rise of Roosevelt and the Birth of PUHCA

Into this furnace stepped Franklin Delano Roosevelt, newly elected, riding a tide of public outrage and reformist zeal. He saw in the electric industry not just a business, but a battlefield—a place where monopoly had strangled innovation, and secrecy had crushed accountability.

And he had an answer.

In 1935, Congress passed the Public Utility Holding Company Act (PUHCA).

It was one of the most radical pieces of corporate legislation in American history.

What PUHCA Did

• Banned holding companies with more than two layers of subsidiaries.

• Forced divestiture of unrelated businesses, ending the era of conglomerate control.

• Required geographic cohesion, limiting utilities to logical service areas—not sprawling national empires.

• Granted the SEC authority to audit and approve all utility mergers, finances, and structures.

In effect, it took the pyramid, smashed it flat, and told every utility in America: “You may generate power. But you may no longer generate confusion.”

The Aftermath

• EBASCO divested, piece by piece, until it became a shell of its former self—eventually transforming into an engineering firm.

• North American Company fought the law for nearly two decades, but was finally dissolved in 1955.

• AG&E’s pieces were scattered into today’s regulated utilities.

• Commonwealth & Southern’s fragments helped form what would become Southern Company.

• Rural electrification, once ignored by profit-driven executives, became a national priority under the New Deal.

A new map of American power was drawn—not by Wall Street, but by law.

“We have not destroyed electricity,” FDR said. “We have simply reminded it whom it serves.”

Chapter 6 – PUHCA and the End of the Empire (1935–1939)

How the law broke the towers, and electricity found its limits.

They had ruled by complexity. Layer upon layer of stock, subsidiary, and silence. Like fortresses built from ledgers, the great holding companies had been too big to explain, too tangled to trace, and too proud to be humble.

But now the law had spoken.

With the ink still drying on the Public Utility Holding Company Act of 1935, the work began—not of punishment, but of surgery. PUHCA wasn’t designed to destroy utilities. It was designed to disentangle them, to simplify, to restore public trust in a system that had, for too long, served shareholders first and customers second.

The empires would not fall in flames. They would fall in filings.

The Great Divestiture

At the heart of PUHCA was a deceptively simple rule:

No utility holding company could operate across multiple states unless it could be effectively regulated.

In practice, this meant:

• One region, one system.

• No more pyramids.

• No more national webs of invisible control.

Every company that had grown beyond a certain scale—beyond a certain clarity—was now given a choice: break yourself up, or be broken.

And so began the quiet revolution.

Company by Company, the Unmaking

EBASCO, once the kingmaker of American power, saw its mighty network pulled apart like threads from a tapestry. Its subsidiaries—American Power & Light, Florida Power & Light, Louisiana Power & Light—were forced to either spin off, consolidate regionally, or operate under strict SEC scrutiny.

By 1939, EBASCO had shed its holdings and transformed itself into an engineering and consulting firm, no longer a force of empire but a humble builder of plants it could no longer own.

North American Company, backed by the financial muscle of J.P. Morgan, fought back—for twenty years—in courts and pressrooms. But in 1955, after a landmark Supreme Court ruling, it was dismantled. Its components—Detroit Edison, Union Electric, Wisconsin Electric—became standalone regulated utilities.

Commonwealth & Southern, too, gave up its dreams of cross-state dominion. From its ruins rose the bones of what would become Southern Company—a regulated giant, yes, but one with clear lines and regional bounds.

The New Rules of Power

Under PUHCA, the electric utility was reimagined:

• It could be private, but not privateering.

• It could be profitable, but not pyramidal.

• It could own generation, transmission, and distribution, but only within a logical geographic area.

The Securities and Exchange Commission became the new gatekeeper. Every merger, acquisition, or financial structure had to pass through its scrutiny.

Gone were the ghost subsidiaries. Gone were the self-dealing loans. Gone were the promises of infinite leverage wrapped in patriotic names.

“You may not own America,” one regulator told a utility executive. “You may serve it.”

What Rose from the Rubble

What emerged in PUHCA’s wake was order. A map of American electricity that finally made sense:

• Southern Company took the Southeast.

• Pacific Gas & Electric (PG&E) remained in California.

• American Electric Power (AEP) became a Midwestern stronghold.

• Duke Power, once a mere regional operator, became a model for the new utility structure: regional, vertically integrated, and regulated.

• Consolidated Edison of New York focused its scope, shedding far-flung holdings to become the city’s stalwart.

It wasn’t perfect. Rates still varied wildly. Rural America still lagged behind. But the days of shadow empires and holding company czars had ended.

Electricity was now a public utility, not a private kingdom.

The Power of the People

And while the holding companies crumbled, something else quietly rose: The Rural Electrification Administration (REA).

Funded by the New Deal and unburdened by profit motives, the REA brought light to places the barons had ignored. By 1940, thousands of rural cooperatives had formed—small towns building their own grids, free of Wall Street’s grasp.

PUHCA had cleared the ground, and now the seeds of democratic power were being sown.

Electricity was no longer a symbol of corporate mastery.

It was becoming a right.

The End of an Era

By 1939, the landscape of American electricity had changed forever.

• The titans of finance were gone or humbled.

• The pyramid structures had been flattened.

• The industry was now accountable—seen, measured, governed.

The wires still hummed. The lights still shone. But the silence at the top—the unchecked, opaque dominion of the few—had been replaced by something new:

Structure. Law. Oversight. Trust.

“The age of empire is over,” declared one New Deal official. “Now begins the age of service.”

And with that, the storm passed.

Chapter 7 – Echoes in the Industry (1940–Present)

How the fragments of empires became the foundations of today’s energy giants.

They thought it was over.

The pyramids had been toppled. The boards dissolved. The moguls disgraced. PUHCA had redrawn the map, restructured the industry, and sent the message: No more invisible empires.

And yet— Power never disappears. It transforms.

The holding companies of the past were gone, yes. But the utilities they once controlled? They endured. They adapted. They reemerged—leaner, regional, and bound by law, but still towering in influence.

The empire had not died.

It had been reincarnated.

The Rebuilding Begins

By the 1940s, what remained of the electric industry had settled into a new architecture:

• Investor-owned utilities served defined regions.

• Public utility commissions regulated rates, mergers, and service areas.

• The federal government oversaw interstate transactions through the SEC and FERC (Federal Energy Regulatory Commission).

But within those rules, the old names began to rise again.

“A giant humbled is still a giant,” said a Missouri state regulator. “You can clip its wings, but it still casts a long shadow.”

Southern Company: A Phoenix in Dixie

Born from the ashes of Commonwealth & Southern, Southern Company emerged in 1945 as a reorganized regional utility. Headquartered in Atlanta, it brought together Georgia Power, Alabama Power, Mississippi Power, and Gulf Power under one roof—legal, regulated, and still massive.

What had once been scattered across holding company charts was now concentrated and controlled—but within the law.

Southern Company became a model: vertically integrated, focused, and publicly accountable.

Yet behind its clean lines and quarterly reports lay the DNA of empire—a centralized structure with deep political ties and vast physical infrastructure.

AEP: From Many, One

American Gas & Electric, one of the most sprawling utility conglomerates of the 1920s, rebranded and refocused, emerging in 1958 as American Electric Power (AEP).

It consolidated:

• Appalachian Power

• Indiana Michigan Power

• Kentucky Power

• Ohio Power

From a collection of tangled subsidiaries came a streamlined Midwestern juggernaut.

AEP would go on to become a leader in coal-fired generation, and later, high-voltage transmission—a utility that once leaned on intercompany loans now became the spine of America’s bulk power system.

Duke, Con Edison, PG&E: The Survivors

Not all companies needed to rebuild. Some simply stayed within their lanes and survived the storm intact.

• Duke Power, a Carolina-based company dating back to James B. Duke’s hydroelectric vision, was modest in scope—but strong in execution. Over time, it grew to absorb Piedmont Natural Gas and merge with Progress Energy, becoming Duke Energy, one of the largest utilities in the U.S.

• Consolidated Edison, born from the merger of New York’s Edison companies, weathered the Holding Company Act without dismantling. Its empire had always been local—but dense. It remains today the utility for New York City: a regulated giant in a vertical city.

• Pacific Gas & Electric (PG&E), once a holding company target, restructured itself into a single operating company for Northern California. It emerged from the 1930s as a strong regional utility, and later became a national symbol—of both innovation and, in time, controversy.

The Co-ops and the REA: Power to the People

Beyond the giants, another revolution took root.

The Rural Electrification Administration, created in 1935 alongside PUHCA, funded cooperative electric utilities across the countryside. These were nonprofit, community-owned entities, built not for dividends but for service.

By 1950, more than 90% of U.S. farms had electricity—a staggering leap from just 10% in 1930.

These co-ops, like Tri-State G&T or NRECA members, never made headlines. But they brought power to the forgotten, and they endured.

In many ways, they were the true successors to the promise the empires never fulfilled.

Memory in the Wires

Today, most Americans do not know the names of the holding companies that once ruled their world. They do not know that behind their local electric company lies a legacy of stock fraud, Senate hearings, and reform.

But that legacy is there—in the regulated rates, in the corporate structures, in the very idea that electricity is a utility, not a luxury.

“The wires remember,” wrote a utility historian. “They may carry new currents, but the ghosts of empire still ride them.”

The Modern Echoes

And yet—some things return.

In the late 20th and early 21st centuries, the industry saw a wave of reconsolidation:

• Deregulation in the 1990s allowed companies to spin off generation and re-enter competitive markets.

• Large utilities began acquiring again, across regions—Exelon, NextEra, Entergy, and others.

• Private equity firms began eyeing the sector, echoing the very models that PUHCA had once dismantled.

Meanwhile, PUHCA itself was repealed in 2005, replaced by lighter oversight and new market structures.

The pyramid has not returned—not fully. But its silhouette grows sharper by the year.

Epilogue – The Ghost in the Wire

The story never ends—not when the current still runs.

Beneath your feet, in every street and alley, a grid hums. It moves invisibly—behind drywall, beneath soil, through lines draped across poles like rosaries for a secular age.

It is the inheritance of a century. And it still carries ghosts.

Because this story—of holding companies and electric barons, of towers built from trust and toppled by truth—is not just history. It is prophecy.

They Promised Light

The early titans did not sell wires. They sold dreams:

• That electricity could elevate mankind.

• That private enterprise could wire a continent.

• That scale was virtue, and complexity was genius.

They made believers of investors and regulators alike. For a time, they were right.

And then, like all myths taken too far, they collapsed under their own enormity.

What they left behind was not just a regulated industry—but a lesson written in copper and courtrooms.

The Pattern Returns

We have seen the shape before.

Pyramidal structures in finance. Opaque ownership in tech. Leverage justified by scale, complexity masked as innovation.

Amazon controls supply chains invisible to most. Meta aggregates data and sells influence through a labyrinth of algorithms. Private equity firms buy hospitals, utilities, and homes—splitting assets, refinancing debt, and smiling for shareholders.

The structure changes. The song remains.

“The modern trust does not call itself a trust,” wrote one 1930s critic. “It simply calls itself efficient.”

The Price of Forgetting

PUHCA was born of crisis, forged by outrage, and wielded with precision. And then, over decades, it was softened, trimmed, repealed.

By 2005, it was gone.

Today, many utilities are again part of sprawling conglomerates. Some are traded as asset classes. Some answer to investment boards half a world away, not the people they serve.

The ghosts in the wire stir once more—not to haunt, but to warn.

Because regulation is memory. And when memory fades, the past repeats—not as tragedy, nor farce, but as business-as-usual.

Still, the Light Remains

And yet…

The grid endures. The lights stay on. The linemen still climb poles in storms. The turbines still turn at midnight.

Across the country, millions are served by utilities that are smaller, simpler, and more accountable than those that came before. Public power districts. Rural co-ops. Regulated investor-owned utilities with roots in broken empires, now standing taller for it.

There is hope in structure. There is justice in transparency.

There is memory, if we choose to keep it.

The Empire is Gone—But the Story Isn’t

We began with a wire. We end with a warning.

Not all power corrupts. But all power must be watched.

The next empire may not be made of utilities. But it will look the same. It will sell promise. It will grow faster than it can be seen. It will say it is too complex to regulate. It will smile behind mirrors.

And it will hope we have forgotten the last time.

“Those who built the industry laid more than wires,” the historian said. “They laid a pattern. And it is still there, waiting to be traced.”