Someone told me that if we used something like 1 kHz AC instead of 50 or 60 Hz AC, it would end up being much cheaper and efficient, because we could use smaller transformers. Is this true? It seems like it would probably cost more as the generators would have to spin much faster - also, it could lead to more losses due to the skin effect. (Just out of curiosity.)
Yes, transformers could be lighter. 400 Hz power is used on aircraft for this reason.
The generator wouldn't need to spin faster if it is designed with more poles. Motors would also have to be redesigned to run at normal speeds with 1000 Hz power.
But how often are 60 Hz transformers used in modern electronics? There is a big one on the pole outside of my house, and in my boat-anchor hi-fi amps and tube guitar amps. All the other power supplies in my house use switching supplies that run their transformers at a much higher frequency.
edit: Another thing, transformers tend to vibrate slightly during operation. A 60 Hz transformer will "hum" a little bit. But imagine all the appliances in your house buzzing at 1 kHz. 1000 Hz is two octaves above middle C, and our ears are 30dB more sensitive to this frequency than 60 Hz:
Image source: http://en.wikipedia.org/wiki/Equal-loudness_contour
You would certainly see problems related to skin effect on long cables, but you would get huge capacitive losses.
It takes some energy to charge a wire to several hundred kV, so doing that more often will need more energy.
The longer the wires the higher the capacity and the higher the losses.
What is actually done is to switch to DC for long / high-voltage lines, with DC the ends of the wire get more expensive because you have to have high-voltage semiconductors to handle rectification at one end and to turn the DC into AC at the other end, but modern semiconductors have brought down the price on those stations a bit, so but for very long transmission lines it's a huge win.