Finding aid for the Centerior Energy Corporation Records

History of the Centerior Energy Corporation

The Centerior Energy Corporation (f. 1892) was incorporated on September 28, 1892, as The Cleveland General Electric Company with a franchise from the General Electric Company of Boston, Massachusetts. The franchise included financial and technical assistance to produce and distribute electric power in a 3/4 square mile radius of downtown Cleveland, Ohio. Shortly thereafter, negotiations to acquire the assets of the Brush Electric Light and Power Company (1881-1893) and The Cleveland Electric Light Company (1884-1893) began. Assets of both companies were transferred in August 1893, forming the nucleus of the new organization. On July 21, 1894, the name of the company was changed to The Cleveland Electric Illuminating Company (CEI) to reflect its role as a provider of light and power, not electric appliances.

During its first two years of operation the company had three short term presidents; W. B. Whitney, Myron T. Herrick (1854-1931) and Horace E. Andrews (d. 1931). In June 1894, James Parmelee (1855-1931) became the fourth president, a position he would occupy for twenty years. Under Parmelee the company began to grow. Power generating facilities were consolidated in a new plant on Canal Road which went into operation in June 1895, providing service to about 750 customers. Between 1897 and 1898, conduit and cables were laid for both alternating and direct current, and the first alternating current generator was installed. By 1905, customers numbered more than 800, and the company's first sub-station had been built on Doan Street just north of Euclid Avenue. Three more sub-stations were added and additions were made at the Canal Road plant, including an 11,000 volt generator. Construction of a new plant at the foot of East 70th Street, the Lake Shore facility, began in 1910 on the site of the old Britton Rolling Mill Company. The new plant went on line August 29, 1911, and the Canal Road plant was used to supply steam for heating. During this period the territory served by the company expanded both East and West, including Bratenahl, East Cleveland, Cleveland Heights, Euclid, and Rocky River. Lakewood was added to company territory when the Lakewood Municipal Light plant was acquired for $81,000 in 1907. The Electrical League of Cleveland, the first trade association in the United States electrical industry, was formed in 1909 to promote the use of electricity and the sale of electrical services. The League was comprised of manufacturers, distributors, contractors, dealers, and CEI employees, particularly from sales and the residential division. Founding member and the League's first president was George E. Miller, sales manager at CEI. To accommodate the growing company a new headquarters, located at 75 Public Square was built and dedicated in 1913.

James Parmelee was succeeded by Samuel Scovil (1885-1950) in February 1914. Scovil had come to CEI as an agent of Spenser Trask and Company, New York mortgage brokers who had helped finance the construction of the Canal Road plant, and eventually became treasurer of CEI. The company enjoyed a modest growth under Scovil's four year tenure and that of Harrison Williams (1874-1954), who succeeded Scovil in 1918. But it wasn't until 1921, when Harrison's successor Robert Lindsay (1869-1933) became president that the company experienced its greatest growth to date.

Lindsay had come to CEI in 1893. A former associate of Thomas Edison and executive of the Brooklyn (New York) Edison Company, he became general superintendent of CEI in 1895. During Lindsay's twelve year tenure as president the company experienced tremendous growth by expanding into unserved areas and acquisition of smaller companies. Control of the company also changed when in 1922 the North American Company, a public utilities holding corporation, purchased controlling interest of CEI's capital stock. In 1924, a site was purchased in Avon Lake, Ohio, for a new plant, and a new steam plant began operations on East 20th Street in Cleveland. The Avon Lake plant went into service in 1926. Additionally, service was extended outside Cuyahoga County for the first time to communities in Lake, Geauga, Ashtabula and Lorain counties.

The purchase of The Cleveland, Painesville and Eastern Railroad Company and its subsidiary, The United Light and Power Company, in January 1926 added more than 200 miles of lines and 7000 consumers to CEI's territory. In March 1926 the company purchased the Conneaut Municipal Light Plant, which served the city of Conneaut, Conneaut Township, and the village of North Kingsville. In July it acquired Lake Erie Power and Light Company which served Painesville and Madison. Chagrin Valley Electric Company and Solon Light and Power Company were added in 1927.

In 1928, Cleveland Southwestern Railway, Light and Power Company in Cuyahoga County, and the Ashtabula Municipal Power Plant were purchased. CEI's territory now extended almost one hundred miles along the southern shore of Lake Erie from Pennsylvania westward. Rate reductions, rehabilitated distribution lines, and replacement of obsolete equipment resulted from the consolidation and expansion. The Ashtabula Power Plant went into service in 1930 with a 50,000 kilowatt generator providing power.

Robert Lindsay was succeeded by Eben B. Crawford (1883-?) on September 6, 1933. Despite the Depression and economic hard times, CEI's consumer base continued to grow, keeping employees of the company working installing service lines to new users. During World War II, to meet increased demands for a wartime economy, a $35 million construction period began. In 1944 CEI served more than 357,000 customers and the company's "Best Location in the Nation" marketing campaign appeared in the national media.

In May 1945, Crawford was succeeded by Elmer L. Lindseth (b.1914) who oversaw dynamic growth. After an anticipated drop in output at the end of the war, CEI gained new customers and sold more power, with CEI customers consuming on average, 24% more than the national average, due to the growing popularity of home appliances such as electric clothes dryers and ranges. In 1947 the North American Company, under the provisions of the Public Utility Holding Act of 1935, divested itself of CEI's stock and control of the company returned to the hands of public investors. The company also acquired two more municipal light facilities; Willoughby in 1950, and Berea in 1951. The Eastlake power plant went into service in 1953, and sales to residential customers exceeded one billion kilowatts for the first time. CEI installed its 500,000th electrical meter to a new customer in Ashtabula County. A new corporate headquarters was opened at 55 Public Square in February 1958. The 1950s saw the company involved in the infant nuclear power industry. CEI helped fund the country's first experimental breeder reactor in 1957 and broadened its involvement by participating in a second reactor development program, the East Central Nuclear Group. In 1958 the company joined another group of utility companies, the High Temperature Reactor Development Association, Inc. Between 1955 and 1959 the company invested more than $185 million in new generating units, transmission and distribution lines, and new sub-stations to serve 138 communities in a 1700 square mile service area. Ralph M. Besse (b. 1905) became president of CEI in 1960. Prior to joining CEI in 1948, he had served as consul to the company through the law firm of Squire, Sanders and Dempsey. Under Besse's direction CEI continued its growth with plans between the company and the Pennsylvania Electric Company to jointly construct a 325,000 kilowatt, $30 million facility near Warren, Pennsylvania. The facility, known as the Seneca Pumped Storage Hydroelectric Power Plant, was to enter the system in 1970. Ten new customer service centers were constructed to allow for more convenient access to the company for its consumers. With the addition of a 250,000 kilowatt unit at the Lake Shore plant in 1962, generating capacity rose to 2, 250,000 kilowatts. In 1967, CEI helped to form the Central Power Coordination Group (CAPCO), a five company power pool with the goal of increasing reliability of interconnections and the construction of larger and more efficient generating facilities.

Besse retired from CEI in 1967 and succeeded by Karl H. Rudolph (b. 1914). During Rudolph's ten years as president, the company witnessed many changes, both in the electric utilities industry and within the company itself. The Seneca facility came on line in 1970, and a computerized System Operation Center opened in 1972. The company's first nuclear power plant, the Davis-Besse facility, near Oak Harbor in northwestern Ohio, received a construction permit from the Atomic Energy Commission in 1971 and became fully operational in 1978. CEI held a 51% share of the facility. Construction began on a second nuclear facility, the Perry Nuclear Power Plant in Lake County, near North Perry, Ohio. The company also experienced a strike by the Utility Workers Local 270 which lasted fifty-eight days, from May 2 to June 27, 1967. It was the longest work stoppage that CEI had ever undergone, with 2300 employees off the job. A second strike in 1973 lasted for one hundred and twenty days. As construction of the Perry plant continued, new problems arose for CEI. Environmental groups, particularly those concerned with the safety of nuclear power, became an issue. Fuel costs and economic inflation increased operating costs, and a $90 million environmental improvement program cut into profits making stock in the company unattractive to buyers. Litigation also became a problem under Rudolph's administration, particularly with the City of Cleveland, when in 1975 it charged the company with an antitrust suit, stating that CEI practices were designed to force its Municipal Light and Power division out of business, specifically in the area of providing emergency power to the city-owned plant. The suit continued for more than ten years under the Kucinich and Voinovich mayoral administrations, with the City of Cleveland eventually losing the lawsuit.

Robert M. Ginn (b.1924) succeeded Rudolph as president in 1978. His six year presidency saw the end of the court battle with the City of Cleveland. Revenues improved, reaching $1.2 billion in the last years of the decade, and the company employed more than 5,000 people.

In 1984 Richard A. Miller (b. 1926) followed Robert Ginn as president. During his four year tenure CEI continued to experience change. In April 1986 Centerior Energy Corporation, an affiliation between CEI and Toledo Edison, was formed to become one of the largest electric systems in the United States, serving more than 2.6 million people in a service area of 4200 square miles in northern Ohio. The new company's assets exceeded $9 billion. Construction problems at the Perry site, Unit 2 plagued the company, and an earthquake in January of 1986 increased environmental concerns. Litigation over rate schedules with consumer groups resulted in the Public Utilities Commission of Ohio mediating gradual rate increases that would allow the company to recover much of its investment in the two Perry units. Despite revenues exceeding $2 billion, common stock dividends declined in 1988.

Robert J. Farling (b.1936) succeeded Miller as president in 1988. A 1990 management audit resulted in a major restructuring, downsizing and wide consolidation of services which resulted in a saving of $100 million in operating expenses. Threat of competition from a municipally owned power plant in Toledo never became a reality. The Davis-Besse nuclear plant became the top operating facility of its kind in the United States in 1992. During that same year more than 1500 employees accepted voluntary retirement, a reduction of 19% in operating staff. The Davis-Besse facility continued to operate at high capacity and a two year plan was put into effect to upgrade performance at Perry Unit One. The company was able to successfully fight off the municipalization of light and power in Brookpark, Ohio, but the threat of increased competition continued to be a problem. The Energy Policy Act of 1992 enabled municipal electric systems to shop for power from regional suppliers while investor owned utilities were mandated to deliver or "wheel" this power to municipal facilities. Favorable PUCO rulings in accounting matters between 1992 and 1995 also helped finances. However, legislation related to "wheeling" power and other regulatory decisions which imposed higher costs to investor owned electric utilities continued to erode profit margins. In September 1996, Centerior Energy Corporation and Ohio Edison merged into a new holding company, First Energy Corporation, with First Energy Corporation holding all of the issued and outstanding common Centerior Energy stock. Centerior stock owners were given a share for share exchange in the new company.

Click here to view the Encyclopedia of Cleveland History entry for Centerior Energy Corporation

Scope and Content

The Centerior Energy Corporation Records, 1881-1996, consist of articles of incorporation, annual reports, bylaws, histories, correspondence, legal briefs, financial records, handbooks, speeches, pamphlets, publications, oral history transcripts, organizational charts, rate schedules, magazine and newspaper clippings, and scrapbooks.

This collection is of value to researchers studying the development of the electric utilities in the United States, and specifically in Cleveland, Ohio, during the late nineteenth and twentieth centuries. The growth of investor-owned power producers is well documented. Of particular interest are the records of The Brush Electric Light and Power Company and The Cleveland Electric Light Company, two small predecessor companies that became the basis of The Cleveland General Electric Company, forerunner of The Cleveland Electric Illuminating Company (CEI). Oral history transcripts of interviews conducted by Robert H. Herrick of the Publicity Department and historical consultant Paula Cohen are a good source of CEI historical data. More than forty interviews were conducted with CEI personnel, including Ralph M. Besse, Elmer L. Lindseth, and Robert M. Ginn, past presidents of the company. Records pertaining to Frank J. Ryan (1887-1969), originator of the "Best Location in the Nation" campaigns, are of interest as examples of corporate advertising. The growth of the nuclear power industry, and CEI's role including the Davis-Besse and Perry Nuclear Power plants, are well represented both in Series IV and in CEI publications directed to the subject. Litigation issues, between CEI and The General Electric Company related to construction and safety issues of the Perry Power Plant, and between CEI and the City of Cleveland, specifically the 1974 antitrust suit, are represented. Additionally, records pertaining to the often acrimonious relationship of CEI with the City of Cleveland, particularly during the mayoralty of Dennis J. Kucinich, are documented through newspaper clippings. The labor disputes of 1967 and 1973 are represented through company news releases, employee update bulletins, and newspaper clippings. Issues which led to the merger that resulted in Centerior Energy Corporation in 1985 and the merger in 1995 into First Energy Corporation are found in the annual reports.

Statement of Arrangement

Restrictions on Access

None.

The researcher should also consult MS 4663 Electrical League of Northern Ohio Records and MS 3913 Cyrus Stephen Eaton Papers.

Photographs from the collection have been removed to PG 499 Centerior Energy Corporation Photographs. All audio-visual materials have been removed to the audio visual collection.

Indexing Terms

The following terms have been used to index the description of this collection in the library's online public access catalog.

Subjects:

Preferred Citation

[Container ___, Folder ___] MS 4791 Centerior Energy Corporation Records, Western Reserve Historical Society, Cleveland, Ohio

Acquisition Information

Centerior Energy Corporation, 1997.

Processing Information

Processed by Patricia J. Stahley and Marilyn Lelli in 1998.

Detailed Description of The Collection