Oil was discovered in Titusville, Pennsylvania in 1857. As the beginning of this century, Americans were still using wood and coal as their primary energy sources. For many years, oil was under-used because the technology to employ it and the distribution infrastructure did not yet exist. Whaling was a major fuel source for lighting homes, and horses were the common form of transportation well into the 20th century. In 1907, only eight percent of the country had electricity.
Technological development during the rest of this century was rapid, and largely based on the discovery of petroleum. Nearly all the mechanical, industrial, architectural, and technological advances, including the automotive industry, were based on the availability of relatively inexpensive, easily useable fossil fuel. New heating and cooling systems, elevators, and advanced building techniques made the development of steel and glass architectural forms possible, leading to buildings whose structures were totally unconnected to local climate or weather conditions. The widespread production and distribution of electricity led to improved lighting, radio, television, and telecommunications.
By 1925, over half of all American homes had electricity, although it was not until after the Second World War that many rural farmhouses were connected to the grid. During this time of electrical expansion, it was clearly cheaper and more profitable for electric utilities to produce electricity in large, centralized generating stations, and the cost of power fell dramatically during this period. Many private industries which had their own generators abandoned them because they were no longer cost effective.
Industrial and electric utility markets for natural gas were comparatively small until after World War II, when natural gas became more widely-available. The impediment to using gas was having the pipelines available to get it from where it was discovered to where it could be used. Before World War II, the interstate (the one between states) pipeline system was not fully implemented. The result was that gas was often vented and flared when it was found with oil or coal and left in place when found by itself. As in the early US, gas pipelines and distribution systems are not in place to get the gas to where it could be effectively used.
Once a viable transportation and distribution system was in place, industry began to use natural gas in manufacturing and processing plants, and electric utilities found that it made an efficient fuel for the boilers they used to make electricity. Natural gas also was used to heat homes and fuel a variety of home appliances such as: water heaters, ovens, cook-tops, and clothes dryers.
The oil embargoes of the 1973 and 1978, the nuclear accident at Three Mile Island, and the electric utility's inability to retain regulatory confidence, resulted in governmental and regulatory incentives to foster co-generation, wind and hydro-electricity, and other decentralized systems on the basis that they were more energy efficient and would restrain electric price increases. Never-the-less, the energy-efficient design and operation of your home and automobile is still the most valuable strategy for the economic well being and future energy supply of the United States.