By the turn of the century, the Edison Illuminating Co. and the Peninsular Electric Light Co. (which owned the electric distribution franchise in the area) provided all commercial electric lighting and power in the city of Detroit.
In January 1903, Detroit Edison purchased securities of the two companies and incorporated on January 17, 1903. That same year, construction began on the Delray 1 power plant, and Henry Ford, who had left Edison Illuminating four years earlier, founded Ford Motor Co.
In 1903, the Detroit Gas Co. was renamed the Detroit City Gas Co. It secured franchises for Highland Park and Hamtramck and increased its customer base to more than 67,000.
In 1904, Detroit Edison signed its first power contract with an automobile company — the Cadillac Motor Car Co.
In 1905, a majority of the Detroit City Gas Co. was acquired by the American Light & Traction Co., a holding company that controlled utility and transportation interests stretching from Grand Rapids to Milwaukee.
With the added demand for electricity, the Delray 2 power plant was added in 1908.
In 1913, Detroit City Gas acquired additional service territory that included the communities of River Rouge, Wyandotte, Dearborn, Ecorse and Trenton.