Transformer development timeline:
1830s - Joseph Henry and Michael Faraday work with electromagnets and discover the property of induction independently on separate continents.
1836 - Rev. Nicholas Callan of Maynooth College, Ireland invents the induction coil
1876 - Pavel Yablochkov uses induction coils in his lighting system
1878 -1883 - The Ganz Company (Budapest, Hungary) uses induction coils in their lighting systems with AC incandescent systems. This is the first appearance and use of the toroidal shaped transformer.
1881 - Charles F. Brush of the Brush Electric Company in Cleveland, Ohio develops his own design of transformer (source: Brush Transformers Inc.)
1880-1882 - Sebastian Ziani de Ferranti (English born with an Italian parent) designs one of the earliest AC power systems with William Thomson (Lord Kelvin). He creates an early transformer. Gaulard and Gibbs later design a similar transformer and loose the patent suit in English court to Ferranti.
1882 - Lucien Gaulard and John Dixon Gibbs first built a "secondary generator" or in today's terminology a step down transformer which they designed with open iron core, the invention was not very efficient to produce. It had a linear shape which did not work efficiently. It was first used in a public exhibition in Italy in 1884 where the transformer brought down high voltage for use to light incandescent and arc lights. Later they designed a step up transformer. Gaulard (French) was the engineer and Gibbs (English) was the businessman behind the initiative. They sold the patents to Westinghouse. Later they lost rights to the patent when Ferranti (also from England) took them to court.
Ottó Bláthy, Miksa Déri, Károly Zipernowsky created the "Z.B.D Transformer"
1884 - In Hungary Ottó Bláthy had suggested the use of closed-cores, Károly Zipernowsky the use of shunt connections, and Miksa Déri had performed the experiments. They found the major flaw of the Gaulard-Gibbs system were successful in making a high voltage circuit work using transformers in parallel. There design was a toroidal shape which made it expensive to make. Wires could not be easily wrapped around it by machine during the manufacturing process.
1884 - Use of Lucien Gaulard's transformer system (a series system) in the first large exposition of AC power in Turin, Italy. This event caught the eye of William Stanley, working for Westinghouse. Westinghouse bought rights to the Gaulard and Gibbs Transformer design. The 25 mile long transmission line illuminated arc lights, incandescent lights, and powered a railway. Gaulard won an award from the Italian government of 10,000 francs.
1885 - George Westinghouse orders a Siemens alternator (AC generator) and a Gaulard and Gibbs transformer. Stanley begin experimenting with this system.
1885 - William Stanley makes the transformer more practical due to some design changes: "Stanley's first patented design was for induction coils with single cores of soft iron and adjustable gaps to regulate the EMF present in the secondary winding. This design was first used commercially in the USA in 1886". William Stanley explains to Franklin L. Pope (advisor to Westinghouse and patent lawyer) that is design was salable and a great improvement. Pope disagrees but Westinghouse decides to trust Stanley anyway.