User:PParmley/PG&E History part 3. draft

Further Consolidation and Expansion
Within a few years of its incorporation, PG&E made significant inroads into Northern California's hydroelectric industry through purchase of existing water storage and conveyance facilities. These included many reservoirs, dams, ditches and flumes built by mining interests in the Sierras that were no longer commercially viable. By 1914, PG&E was the largest integrated utility system on the Pacific Coast. The company handled 26 percent of the electric and gas business in California. Its operations spanned 37,000 square miles across 30 counties.

The company expanded in the 1920s through strategic consolidation. Important acquisitions during this period included the California Telephone and Light Company, the Western States Gas and Electric Company and the Sierra and San Francisco Power Company, which provided hydropower to San Francisco's streetcars. These three companies added valuable properties and power and water sources. By the end of 1927, PG&E had nearly one million customers and provided electricity to 300 Northern Californian communities.

In 1930, PG&E purchased majority stock holdings in two major Californian utility systems—Great Western Power and San Joaquin Light and Power—from The North American Company, a New York investment firm. In return, North American received shares of PG&E's common stock worth $114 million. PG&E also gained control of two smaller utilities, Midland Counties Public Service and the Fresno Water Company, which was later sold. The acquisition of these utilities did not result in an immediate merger of property and personnel. The Great Western Power Company and the San Joaquin Company remained separate corporate entities for several more years. But through this final major consolidation, PG&E soon served nearly all of Northern and Central California through one integrated system.

Natural Gas
The gas industry market structure was dramatically altered by the discovery of massive natural gas fields throughout the American Southwest beginning in 1918. The fuel was cleaner than manufactured gas and less expensive to produce. While natural gas sources were abundant in Southern California, no economical sources were available in Northern California. In 1929, PG&E constructed a 300-mile pipeline from the Kettleman oil field to bring natural gas to San Francisco. The city became the first major urban area to switch from manufactured gas to natural gas. The transition required the adjustment of burners and airflow valves on 1.75 million appliances. In 1936, PG&E expanded distribution with an additional 45-mile pipeline from Milpitas. PG&E gradually retired its gas manufacturing facilities, although some plants were kept on standby.

Defense activities boosted natural gas sales in California during World War II, but cut deeply into the state's natural reserves. In 1947, PG&E entered into a contract with the Southern California Gas Company and the Southern Counties Gas Company to purchase natural gas through a new 1,000-mile pipeline running from Texas and New Mexico to Los Angeles. Another agreement was reached with the El Paso Natural Gas Company of Texas for gas delivery to the California-Arizona border. In 1951, PG&E completed a 502-mile main which connected with the El Paso network at the state line.