Cite as: 519 U. S. 278 (1997)
Syllabus
presumably pays more for gas purchased from out-of-state producers and marketers. See Bacchus Imports, Ltd. v. Dias, 468 U. S. 263, 267. Pp. 286-287. 2. Ohio's differential tax treatment of natural gas sales by public utilities and independent marketers does not violate the Commerce Clause. Pp. 287-311. (a) Congress and this Court have long recognized the value of state-regulated monopoly arrangements for gas sales and distribution directly to local consumers. See, e. g., Panhandle Eastern Pipe Line Co. v. Michigan Pub. Serv. Comm'n, 341 U. S. 329. Even as congressional and regulatory developments resulted in increasing opportunity for a consumer to choose between gas sold by marketers and gas bundled with state-mandated rights and benefits as sold by LDC's, two things remained the same: Congress did nothing to limit the States' traditional autonomy to authorize and regulate local gas franchises, and those franchises continued to provide bundled gas to the vast majority of consumers who had neither the capacity to buy on the interstate market nor the resilience to forgo the reliability and protection that state regulation provided. To this day, all 50 States recognize the need to regulate utilities engaged in local gas distribution. Pp. 288-297. (b) Any notion of discrimination under the Commerce Clause assumes a comparison of substantially similar entities. When the allegedly competing entities provide different products, there is a threshold question whether the companies are indeed similarly situated for constitutional purposes. If the difference in products means that the entities serve different markets, and would continue to do so even if the supposedly discriminatory burden were removed, eliminating the burden would not serve the dormant Commerce Clause's fundamental objective of preserving a national market for competition undisturbed by preferential advantages conferred by a State upon its residents or resident competitors. Here, the LDCs' bundled product reflects the demand of a core market—typified by residential customers to whom stability of rate and supply is important—that is neither susceptible to competition by the interstate sellers nor likely to be served except by the regulated natural monopolies that have historically supplied its needs. So far as this non-competitive market is concerned, competition would not be served by eliminating any tax differential as between sellers, and the dormant Commerce Clause has no job to do. On the other hand, eliminating the tax differential at issue might well intensify competition between LDC's and marketers for the noncaptive market of bulk buyers like GMC, which have no need for bundled protection. Thus, the question here is whether the existence of competition between marketers and LDC's in the noncaptive market requires treating the entities as alike for dor-
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