I. The Statutory Framework

The Federal Power Act of 1935, codified at 16 U.S.C. § 791a et seq., charged the Federal Energy Regulatory Commission’s predecessor with the effective federal regulation of the expanding business of transmitting and selling electric power in interstate commerce, closing the regulatory void the Supreme Court had identified between state authority and federal reach.¹ Section 201(a) of the Act declares that the business of transmitting and selling electric energy for ultimate distribution to the public “is affected with a public interest,” and that federal regulation of the transmission of electric energy in interstate commerce and the sale of such energy at wholesale in interstate commerce is necessary in the public interest.²

Section 201(b), codified at 16 U.S.C. § 824(b), provides that the Act’s provisions apply to “the transmission of electric energy in interstate commerce and to the sale of electric energy at wholesale in interstate commerce.” The same subsection contains the jurisdictional grant in plain language: “The Commission shall have jurisdiction over all facilities for such transmission or sale of electric energy.”³ Section 201(c) defines the trigger: electric energy is “transmitted in interstate commerce if transmitted from a State and consumed at any point outside thereof.”⁴ A “public utility” under the Act, at 16 U.S.C. § 824(e), is “any person who owns or operates facilities subject to the jurisdiction of the Commission under this subchapter.”⁵

Section 205 of the Act, codified at 16 U.S.C. § 824d, imposes the core obligation. Subsection (a) provides that all rates and charges made, demanded, or received by any public utility for or in connection with the transmission or sale of electric energy subject to the jurisdiction of the Commission — and all rules and regulations affecting or pertaining to such rates or charges — shall be just and reasonable, and any rate or charge that is not just and reasonable is unlawful.⁶ Subsection (c) requires every public utility to file with the Commission schedules showing all rates and charges for any transmission or sale subject to the Commission’s jurisdiction, together with the forms of all contracts relating thereto.⁷ Section 206, at 16 U.S.C. § 824e, authorizes the Commission to investigate any rate, charge, or practice, and, upon finding it unjust, unreasonable, unduly discriminatory, or preferential, to determine the just and reasonable rate itself.⁸

The filing apparatus is completed by the Commission’s own regulations. Under 18 CFR § 35.10b, every public utility must file an updated Electric Quarterly Report with the Commission, covering all services it provides under Part 35, for each of the four calendar quarters of each year: January through March by April 30, April through June by July 31, July through September by October 31, and October through December by January 31.⁹ The requirement is categorical. It admits of no exemption for weather.

II. The Operator

The operator is the thunderstorm, and its transmission facilities are the lightning channels themselves. This is not a metaphor, an analogy, or a figure of speech. When charge separation inside a cumulonimbus cloud exceeds the insulating capacity of the atmosphere, the air breaks down and a stepped leader ionizes a conductive channel from cloud to ground; the return stroke then transmits electric energy along that channel at approximately one-third the speed of light. The National Weather Service reports that a typical flash carries approximately 300 million volts and roughly 30,000 amperes — instantaneous electrical power on the order of terawatts, with total energy sufficient to power a 100-watt bulb for over three months.¹⁰

A careful reader will object that Section 201(b) expressly withholds Commission jurisdiction “over facilities used for the generation of electric energy.” This investigation does not concern the cloud. The cloud is the generator, and the Commission is welcome to it. This investigation concerns the wire: the ionized channel, a facility that exists for the sole purpose of transmitting electric energy from one place to another, operating at voltages and currents no human utility could insure, in continuous service every summer across the American South and Midwest.

The operator owns or operates these facilities. It schedules them, dispatches them — often with seconds of warning — and curtails them when the charge separation resolves. It has approximately 25 million transmission events per year in the United States alone, according to the National Weather Service’s count of average annual cloud-to-ground strikes.¹¹ It has no tariff on file. It has no service agreement. It has no interconnection agreement with any balancing authority, and it has never once filed for market-based rate authority under the Commission’s standards.

III. The Scale of the Violation

Twenty-five million flashes per year, each carrying on the order of a billion joules of energy, deliver approximately 25 quadrillion joules — about seven billion kilowatt-hours — of electric energy per year.¹² For context, a one-gigawatt power plant operating at an eighty-percent capacity factor produces about seven terawatt-hours per year, the same order of magnitude.¹³ If the operator filed as a single generator, its annual energy deliveries would rank it alongside a mid-size baseload plant in every organized market in the country. Against national electricity consumption of roughly 4.1 trillion kilowatt-hours per year, it is a fraction of a percent — but the Commission does not regulate by market share. It regulates by jurisdiction, and the jurisdictional grant has no de minimis clause.¹⁴

The instantaneous picture is more dramatic. Multiplying the Weather Service’s figures — 300 million volts times 30,000 amperes — yields a peak power of approximately nine trillion watts.¹⁵ Congress, in the Public Utility Regulatory Policies Act of 1978, defined a small power production facility as one with a capacity of no more than 80 megawatts.¹⁶ A single lightning flash exceeds that statutory ceiling by a factor of more than one hundred thousand. Every flash is, in instantaneous terms, a generating facility more than a hundred thousand times the size of the largest facility Congress contemplated as “small” — delivered without a qualifying-facility certification, without an avoided-cost contract, and without a single filed rate.

IV. The Interstate Commerce

Section 201(c) requires only that energy be “transmitted from a State and consumed at any point outside thereof.” The operator satisfies this test routinely, in two ways. First, thunderstorm complexes are regional systems that travel for hundreds of miles across state lines; a single mesoscale convective system can generate electricity in Oklahoma and deliver it, hours later, in Arkansas, with no change in the operator’s corporate structure, because the operator has none. Second, the individual transmission events themselves cross state lines: bolts from the blue — flashes that exit the back of a thunderstorm, travel through clear air, and angle down to the ground — have been documented traveling as far as 25 miles from the parent storm, according to the National Oceanic and Atmospheric Administration.¹⁷

The statutory definition contains no minimum distance, no requirement of a wire, and no exception for transmission media made of ionized air. Energy transmitted from a state and consumed at any point outside thereof is interstate commerce, full stop. The operator’s longest documented individual transmission event — 25 miles — is longer than the entire width of several American states at their narrowest points. The Commission’s own jurisdictional test was designed for the interconnected grid; it applies, as written, to the interconnected sky.

V. The Missing Rate Schedule

Under Section 205, the operator’s rates must be just and reasonable, and they must be filed. The operator’s rate is zero dollars per megawatt-hour: every flash is delivered free of charge, to whatever point of interconnection the atmosphere selects, with no contract, no counterparty credit review, and no capacity commitment.

Zero dollars is not a just and reasonable rate. It is the deepest discount in the history of the wholesale electricity market — energy delivered at a price below the marginal cost of every generator in every organized market, below the price floor of every price-cap construct the Commission has ever approved, with no cost-of-service justification on file because no filing of any kind exists. If a human power marketer delivered seven billion kilowatt-hours a year at zero dollars with no tariff on file, the Commission’s Office of Enforcement would open an investigation before the quarter ended. The operator has delivered at zero dollars for approximately as long as there has been weather.

The Commission possesses the remedy and has never used it. Under Section 206, it may investigate any rate, charge, or practice affecting jurisdictional service and substitute the just and reasonable rate by order. In the ninety-one years since the Federal Power Act’s enactment, the Commission has never once opened a Section 206 investigation into the operator’s rates. It has never issued a show-cause order. It has never demanded the filing that Section 205(c) requires. The largest unfiled rate schedule in American energy history continues to operate, uninvestigated, at zero dollars.

VI. The Missing Quarterly Reports

The Electric Quarterly Report is the Commission’s window into the wholesale market: every public utility must file one, every quarter, covering every service it provides under Part 35 — transaction data, contract data, the prices, the counterparties, the points of receipt and delivery. The filing deadlines are April 30, July 31, October 31, and January 31.⁹ The reports are prepared in conformance with the Commission’s software and guidance, which assume, among other things, that the filer has a company name.

The operator has never filed an Electric Quarterly Report. It has missed every deadline in the regulation’s history: the first-quarter reports due each April 30, the second-quarter reports due each July 31 — including, notably, the July 31 deadline that falls squarely in peak lightning season, when the operator is at its most active and its reporting obligation at its most urgent — the third-quarter reports due each October 31, and the fourth-quarter reports due each January 31.

Section 315(a) of the Act, at 16 U.S.C. § 825n(a), provides civil penalties for failure to file required documents — a maximum that the Commission’s January 2025 inflation adjustment set at $3,738 per violation.¹⁸ Applied per missed quarterly filing, per quarter, across the regulation’s entire history, the operator’s exposure for paperwork violations alone would fund a small agency. The Commission has never assessed a dollar.

VII. The Reliability Gap

Section 215 of the Federal Power Act, added by the Energy Policy Act of 2005 and codified at 16 U.S.C. § 824o, established mandatory, enforceable reliability standards for the bulk-power system, administered by the North American Electric Reliability Corporation subject to Commission oversight. The standards apply to all users, owners, and operators of the bulk-power system.¹⁹ The operator is, by energy volume, the largest unplanned injector of electric energy into the bulk-power system in North America, and it has never registered with the Electric Reliability Organization as a generator owner, a generator operator, a transmission owner, or anything else.

The consequences of this unregistered operation are documented in the insurance record rather than the reliability record, because the reliability record has no category for the operator. The National Weather Service reports that lightning causes approximately 25,000 fires in the United States every year, including about 4,400 house fires and 1,800 other structural fires, with total lightning-caused damages approaching $1 billion annually.²⁰ Every transmission utility in the lightning belt maintains a lightning performance program — shielding, grounding, surge arresters — designed around the operating characteristics of an entity that files nothing, registers nowhere, and coordinates with no one. The industry’s reliability planning assumes the operator’s continued participation. The industry’s regulatory framework does not acknowledge the operator at all.

VIII. The Damage Record

The Insurance Information Institute’s most recent accounting reports that lightning caused $1.65 billion in United States homeowners insurance claim payouts in 2025, across 61,986 claims, at an average cost of $26,616 per claim — with Texas generating the highest total insured losses at nearly $253 million and the highest average cost per claim at $60,382.²¹ The National Weather Service, using a longer lens, documented that between 1984 and 2013, lightning killed more than 1,500 people in the United States, an average of 51 per year, and injured an estimated 15,000.²⁰

These are the externalities of an unregulated wholesale market participant. Every strike is a delivery of unpriced, unscheduled, unfiled electric energy to a customer that did not order it, through a facility that was never certificated, at a voltage that no filed tariff contemplates. The homeowners whose roofs the energy is delivered to are, in the Commission’s vocabulary, ultimate consumers — the very parties Section 201(a) declares the Act exists to protect. The Act’s protections have never reached them, because the energy arrives before the paperwork, which never arrives at all.

IX. The Jurisdictional Void

Section 201(b) applies to “any person,” and a thunderstorm is not a person, and this investigation discloses the fact plainly, as the genre requires. The statute was written for utilities with boards of directors, rate departments, and registered agents for service of process. The operator has none of these. It cannot be served. It cannot be deposed. It cannot execute a compliance filing, because it has no hands, and it cannot retain counsel, because it has no money, although it does, by the arithmetic of this investigation, owe approximately $40 trillion, as discussed below.

There is also the generation exclusion to contend with. Section 201(b) withholds Commission jurisdiction over “facilities used for the generation of electric energy.” The cloud, where charge separation occurs, is plausibly a generation facility, and this investigation has accordingly declined to assert jurisdiction over any cloud. But the ionized channel is not the cloud. It is the wire — a transmission facility by function, by physics, and by the plain meaning of the words “facilities for such transmission.” The Commission has jurisdiction over all such facilities. It has jurisdiction over this one. The one facility the statute unambiguously reaches is the one the Commission has never examined.

X. The Enforcement Impossibility

Section 316A of the Federal Power Act, at 16 U.S.C. § 825o-1(b), authorizes civil penalties for violations of the Act. The Commission’s January 2025 inflation adjustment set the maximum at $1,584,648 per violation, per day.²² Applied to the operator’s approximately 25 million annual transmission events, each a separate unfiled, unreported, unrated jurisdictional transaction, the aggregate maximum penalty exposure is approximately $39.6 trillion per year.²³

The figure exceeds the gross domestic product of the United States. It exceeds the gross domestic product of every nation on Earth, combined, with room to spare for the penalty exposure of several additional unregulated weather systems. It would be the largest civil penalty in the history of federal enforcement, assessed against a respondent with no assets, no bank accounts, no mailing address, and no capacity to execute a payment instrument. The Commission could revoke the operator’s market-based rate authority, except that no such authority was ever granted. It could order the operator to file a tariff, except that the operator’s filing system consists of rain.

The problem is not that the law lacks scope. The Federal Power Act reaches the transmission of electric energy in interstate commerce. The regulations define the filing obligations. The quarterly reporting regime is comprehensive. The reliability standards are mandatory. The penalty provisions are severe. The statutes reach every conceivable electricity scenario that a 1935 Congress could have imagined. The scenario it did not imagine was one in which the transmission facility cannot read, cannot be served with process, and communicates primarily by discharging 300 million volts into the nearest tall object.

The Commission regulates thousands of public utilities. The operator is not one of them. The ratio of filed rate schedules is thousands to zero. The ratio of Electric Quarterly Reports filed is thousands to zero. The ratio of market-based rate authorizations is thousands to zero. The ratio of terawatt-hours delivered without a filing is zero to seven.

The largest unlicensed interstate electricity operation in American history has been in continuous service since before the Federal Power Act was enacted, before the Commission existed, and before the states whose lines it crosses were admitted to the Union in several cases. It has never filed a rate schedule, never submitted a quarterly report, never registered with the reliability organization, and never paid a dollar of civil penalties. It delivers approximately seven billion kilowatt-hours of electric energy per year, at zero dollars, to customers who did not order it, through facilities no inspector has ever examined.

Ergo.