In the 1970 case Atlantic City Electric Co. et al. v. United States et al., the U.S Supreme Court ruled in favor of the Federal Power Commission (FPC), now known as the Federal Energy Regulatory Commission, affirming its jurisdiction over wholesale sales of electricity from a nuclear power plant located in New Jersey to public utilities for resale to consumers across state lines. The petitioners, including several utility companies and states, argued that such regulation was beyond FPC's authority under Section 201(b) of the Federal Power Act because it involved generation facilities which were exempted by this section from federal control unless specifically included by Congress. However, Justice Thurgood Marshall delivered an opinion stating that while FPC could not directly regulate production or generation facilities themselves, it did have jurisdiction over interstate wholesale rates and transactions involving energy produced at these sites.

In the dissenting opinion for Atlantic City Electric Co. et al. v. United States et al., Justice Harlan argued that the Federal Power Commission (FPC) did not have jurisdiction over wholesale sales of electricity generated by offshore facilities located on the Outer Continental Shelf, as these were beyond state boundaries and thus outside FPC's regulatory purview under the Federal Power Act. He contended that Congress had intended to treat such offshore facilities differently from those within states when it enacted legislation specifically governing them, namely, the Outer Continental Shelf Lands Act and Submerged Lands Act. Furthermore, he disagreed with majority’s interpretation of “interstate commerce” in this context; while acknowledging that electricity transmission could be considered interstate commerce due to its nature crossing state lines physically or potentially affecting other states economically, he maintained this didn't automatically extend federal regulation into areas traditionally reserved for individual states without explicit congressional authorization.