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InterviewsHarold Platt


Great Projects: The Building of America

HP: Once Insull decided that by the massing of production he could achieve universal supply for all his customers he went ahead to get as many customers as he could. The biggest user of electricity in the late 1890s in Chicago and elsewhere were the electric streetcar companies and electric elevated companies. In Chicago, Charles Yerkeys had involved the street railways in so much dirty politics, that the street railway companies themselves could not raise any money because of politics in the franchises were just tangled up completely. Insull took advantage of this, saying he would supply the power for the transit companies in Chicago and he would be able to finance the building of the stations to provide this power. Once he got the contract, then he was able to get the money to finance the building of the first really large scale generating plant at Fisk Street, the historic Fisk Street Station in 1903. Once he came aligned with that success, he was able then to continue this process of adding more customers, building the load, as it's called, and reducing the unit cost of electricity, so that more and more and more people could afford to use electricity and use more of it.

HP: In the late 1890s after Insull decided to build gigantic generating systems and provide a massing of production he faced a real engineering problem. The problem was that at the time generators could only be built so big. The basic problem is that steam engines in that day basically went up and down. They were called reciprocating engines, and at some point when you built them big enough, so big they began to destroy the foundations from the pounding, and the metal itself faced fatigue and would fall apart. So he seemed to be facing a limit that he could not get beyond. At the same time, though, there was an alternative technology-spinning turbines that had been used in water and very small electric plants elsewhere.

Insull's idea was to go to GE and tell them to build a really, really big one, steam turbine. And that this would solve the problem of the pounding turning into a smooth rotary motion. GE was astounded that you could build such a thing. They were very unsure whether such a thing could be done, and they said, "We won't take the risk. No one has done this. It probably can't be done." Insull said, "Do it anyway. I'll take the risk." And GE then went ahead built this steam turbine, this ... experimental machine. It was installed at Fisk Street, and everyone was quite unsure whether it would work or not. In fact, I think Insull's chief engineer said, "You better leave the building. It may blow up." And Insull's answer apparently was, "If it blows up, I'm going to stay here and blow up with it."

HP: Once Sam Insull got the street railway contracts basically he had the money to pay the bills for the expensive equipment he was buying and the building of the Fisk Street Station. Everything that he added during the times the street railways weren't running during the rush hours was sort of gravy. It was definitely going to be pure profit for him, and he realized that he could go out and sell electricity to every kind of customer -- night customers, day customers housewives, businesses, and he really went after them all. He became a genius in marketing electricity. He offered all night restaurants very cheap deals. He went to the ice companies and says, "Look, make your ice at the night time when everybody else is sleeping, the electricity is off, my equipment is sitting idle. I'll give you a deal." They went for it.

He went to big office buildings and said, "Look, your elevators aren't working well because you use old antiquated equipment. Bring in central station service, your elevators will work great." And sold office buildings on that idea as well. So he went after everyone. He went after housewives by sending door-to-door salesmen. He figured that once they were hooked up, they were hooked. So one of his most famous campaigns was giving away electric items. And in a big fanfare, he sent around to the neighborhoods these big trucks handing out the irons if they would only sign up for service, realizing that once they had signed up for that service they would just add more and more use to it and would never unplug their irons or their lights.

HP: Sam Insull went after every kind of customer from the biggest to the smallest. Maybe the smallest was the household and the housewife. In one famous campaign, he brought in 10,000 GE irons and gave them away free, so to speak, to anyone who would sign up for service. He realized that once the housewife had the convenience of the modern iron, had the electric lights in the house, that they would never give it up again. So once they were hooked up, they were hooked.

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