The U.S. Supreme Court case Federal Power Commission v. Conway Corp et al., 1975, revolved around the issue of whether or not a municipal corporation that generates and sells electric power both for its own use and to other consumers could be classified as a "public utility" under Part II of the Federal Power Act (FPA). The court ruled in favor of Conway Corporation, stating that it was not subject to regulation by the Federal Power Commission (now known as the Federal Energy Regulatory Commission) because it did not fit within FPA's definition of public utilities. This decision was based on an interpretation of legislative intent behind FPA which suggested Congress intended to exclude governmental entities from this classification due to their accountability directly to voters rather than shareholders.

In the dissenting opinion for Federal Power Commission v. Conway Corp., it was argued that the majority's decision to uphold federal jurisdiction over wholesale electricity sales by municipalities, even if they were within a single state, expanded the reach of federal power beyond what was intended by Congress in passing the Federal Power Act. The dissenters believed that this interpretation disregarded clear statutory language and legislative history indicating that such transactions should be exempt from regulation under Section 201(b) of the act. They also expressed concern about potential negative impacts on municipal utilities and their customers due to increased regulatory burdens and costs associated with compliance with federal rules. Furthermore, they contended that this ruling could undermine states' rights and local control over public utilities which have traditionally been regulated at a state or local level rather than federally.