## Facts

- Narragansett Electric Lighting Company, a Rhode Island utility, generated and sold electricity from Providence.
- Attleboro Steam & Electric Company, a Massachusetts utility, supplied electricity to customers in Attleboro, Massachusetts, and nearby areas.
- In 1917, the companies entered a 20-year wholesale contract under which Narragansett agreed to supply all electricity required by Attleboro for its own use and for resale to its Massachusetts customers.
- The contract provided for delivery at the Rhode Island–Massachusetts state line, with transmission over connecting lines to Attleboro’s Massachusetts station, where the electricity was metered.
- Narragansett filed the contract rate and terms with the Rhode Island Public Utilities Commission and received authorization for the special rate; Attleboro dismantled its own generating plant in reliance on Narragansett’s supply.
- In 1924, Narragansett filed a new schedule with the Commission purporting to cancel the original schedule and impose an increased rate for electricity delivered in Rhode Island or at the state line; Attleboro was effectively the only customer to which the new schedule applied.
- After investigation, the Commission found the contract rate unreasonable and ordered the increased rate into effect, reasoning that continued service at the contract rate would harm Narragansett’s ability to serve other customers and the public welfare.
- Attleboro challenged the order as unconstitutional regulation of interstate commerce.

## Issues

1. Whether the sale and delivery of electricity at the state line by a Rhode Island utility to a Massachusetts utility for resale in Massachusetts constitutes interstate commerce.
2. Whether Rhode Island may constitutionally regulate the wholesale rate for that cross-border transaction through its public utilities commission.

## Decision

- The Supreme Court held that the transaction and transmission of electricity under the contract constituted interstate commerce.
- The Court held Rhode Island lacked power to regulate the wholesale rate for this interstate sale, even if the state viewed the regulation as necessary to protect the seller and its local consumers.
- The Court affirmed the Rhode Island Supreme Court’s judgment invalidating the Commission’s rate order.

## Legal Principles

- A time contract for electric current delivered at a state line by a seller in one state to a buyer in another state, for transmission and resale in the buyer’s state, is interstate commerce.
- A state may not directly regulate the wholesale rate for such an interstate electricity transaction; doing so imposes an unconstitutional direct burden on interstate commerce absent congressional authorization.
- State authority over utilities does not extend to setting interstate wholesale rates merely because the generating utility and its local customers are located within the regulating state.

## Conclusion

The Court invalidated Rhode Island’s attempt to raise the wholesale rate for electricity sold across the Rhode Island–Massachusetts border, holding that interstate wholesale electricity rate-setting lies beyond unilateral state control under the Commerce Clause.


Pub. Utils. Comm’n of R.I. v. Attleboro Steam & Elec. Co., 273 U.S. 83 (1927)