California’s Solar and Wind Energy Curtailment Crisis

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May 29, 2025

California’s grid is curtailing solar and wind energy at record levels. Why is this happening, and what solutions are on the horizon? Dive into the challenges and innovations reshaping the state’s energy future.

Financial market analysis from 29/05/2025. Market conditions may have changed since publication.

Have you ever wondered what happens when the sun shines too brightly or the wind blows too fiercely? In California, where renewable energy is booming, the state’s grid operator is facing a surprising challenge: too much clean energy. It’s a paradox that feels almost absurd—how can an abundance of solar and wind power be a problem? Yet, for the folks managing California’s electricity grid, this oversupply is creating a delicate balancing act that’s both fascinating and critical to the future of sustainable energy.

The Renewable Energy Boom and Its Challenges

California has long been a leader in the push for clean energy. Over the past decade, the state has dramatically expanded its solar and wind capacity, transforming its energy landscape. By the end of 2024, the combined capacity of these renewable sources reached an impressive 28.2 gigawatts, a massive leap from just 9.7 gigawatts in 2014. This growth is something to celebrate, but it’s also straining the grid in ways most of us don’t think about when we flip on a light switch.

The California Independent System Operator, or CAISO, is tasked with keeping the grid humming smoothly. Their job is to balance supply and demand in real time, ensuring that electricity flows where it’s needed without overloading the system. But with so much renewable energy flooding the grid—especially during sunny spring days or windy afternoons—CAISO is increasingly forced to curtail, or reduce, the output of solar and wind farms. In 2024 alone, they curtailed 3.4 million megawatthours of renewable energy, a 29% jump from the previous year. That’s enough electricity to power thousands of homes, simply turned off or redirected.

The grid is like a tightrope walker juggling flaming torches—balance is everything, and one wrong move can spell trouble.

– Energy systems analyst

Why Curtailment Happens

So, why does CAISO have to hit the brakes on clean energy? It comes down to two main culprits: congestion and oversupply. Congestion occurs when the power lines simply can’t handle the volume of electricity being generated. Think of it like a traffic jam on the highway—too many cars, not enough lanes. Oversupply, on the other hand, happens when there’s more electricity being produced than consumers need at that moment. This is especially common in spring, when mild temperatures keep air conditioners and heaters off, but solar panels are churning out power at full tilt.

In 2024, a whopping 93% of curtailed energy came from solar power. The reason? Solar production peaks during the day, especially in spring, when demand is relatively low. By contrast, evening hours—when people return home, crank up appliances, and turn on lights—see a spike in demand, but solar panels are no longer generating power after sunset. This mismatch creates a tricky puzzle for grid operators.

Another factor is the need to keep some natural gas plants running to meet reliability standards. These plants provide a steady baseline of power and can ramp up quickly to meet evening demand, something solar and wind can’t do on their own. As a result, CAISO sometimes curtails renewable energy to make room for gas, ensuring the grid stays stable.


The Impact of Curtailment

Curtailing renewable energy isn’t just a technical issue—it’s a missed opportunity. Every megawatt-hour of solar or wind power that’s turned off represents clean energy that could have reduced reliance on fossil fuels. It’s frustrating to think that energy from the sun and wind is going to waste, especially in a state as committed to sustainability as California. In my view, it’s like baking a delicious cake and then tossing half of it in the trash—such a shame!

But the impacts go beyond waste. Curtailment can also affect the economics of renewable energy projects. Developers invest heavily in solar and wind farms, expecting to sell their electricity to the grid. When that power is curtailed, they lose revenue, which could discourage future investments. On the flip side, CAISO’s actions are necessary to prevent blackouts or grid failures, which would be far worse for everyone.

Here’s a quick breakdown of the curtailment challenge:

  • Oversupply: Too much renewable energy during low-demand periods.
  • Congestion: Power lines can’t carry all the generated electricity.
  • Reliability: Natural gas plants must stay online to meet evening demand.
  • Economic impact: Lost revenue for renewable energy producers.

Innovative Solutions to Reduce Curtailment

Thankfully, California isn’t sitting idly by while renewable energy goes to waste. CAISO and other stakeholders are rolling out creative solutions to tackle curtailment and make the grid more resilient. One of the most exciting developments is the rise of battery storage. In 2024, battery capacity in California jumped by 45%, from 8.0 gigawatts to 11.6 gigawatts. These batteries can store excess solar power during the day and release it in the evening, smoothing out the supply-demand mismatch.

Picture this: it’s noon, the sun is blazing, and solar panels are generating more power than the grid needs. Instead of curtailing that energy, batteries soak it up like a sponge. Hours later, when the sun sets and demand spikes, those batteries release their stored energy, keeping the lights on without relying on fossil fuels. It’s a game-changer, but there’s a catch—batteries can only store energy for a few hours, not days. In spring, when oversupply is at its peak, even batteries can’t absorb it all.

Batteries are the unsung heroes of the modern grid, turning fleeting sunlight into reliable power.

– Clean energy advocate

Another promising solution is energy trading. Through the Western Energy Imbalance Market (WEIM), CAISO can sell excess renewable energy to neighboring regions in real time. In 2024, this market helped avoid 274,000 megawatthours of curtailment—about 8% of the total curtailed energy. By May 2026, the Extended Day-Ahead Market (EDAM) will launch, giving CAISO another tool to offload surplus power and reduce waste.

Thinking Outside the Box: Hydrogen and Beyond

Perhaps the most intriguing solution on the horizon is the use of excess renewable energy to produce hydrogen. Starting in 2025, some companies plan to harness surplus solar and wind power to create hydrogen, which can be stored and later mixed with natural gas for power generation. A new facility at the Intermountain Power Project, set to come online in July, will test this approach. It’s a bold idea that could turn wasted energy into a valuable resource, especially during the high-demand summer months.

CAISO is also working on long-term fixes, like expanding transmission capacity and incorporating curtailment reduction into grid planning. More transmission lines would ease congestion, allowing renewable energy to flow to areas with higher demand. Meanwhile, adding more flexible resources—like advanced batteries or demand-response programs—could help the grid adapt to sudden shifts in supply or demand.

SolutionHow It HelpsCurrent Status
Battery StorageStores excess energy for later use45% capacity increase in 2024
Energy Trading (WEIM)Sells surplus power to neighborsAvoided 274,000 MWh curtailment
Hydrogen ProductionConverts excess energy into fuelStarting July 2025
Transmission UpgradesReduces grid congestionIn planning phase

What’s Next for California’s Grid?

As I reflect on California’s energy journey, I can’t help but feel a mix of optimism and urgency. The state’s commitment to renewable energy is inspiring, but the curtailment challenge highlights how complex the transition to a clean energy future can be. Batteries, hydrogen, and energy trading are exciting steps forward, but they’re not silver bullets. To truly unlock the potential of solar and wind power, California needs to keep investing in grid infrastructure and innovative technologies.

One thing’s clear: the grid of tomorrow won’t look like the grid of today. It’ll be smarter, more flexible, and better equipped to handle the ups and downs of renewable energy. But getting there will require creativity, collaboration, and a willingness to think outside the box. What do you think—can California solve its curtailment conundrum and lead the way for other states? I’d love to hear your thoughts.


In the meantime, CAISO’s efforts offer a glimpse into the future of energy management. By blending cutting-edge technology with strategic planning, they’re tackling one of the biggest challenges in the renewable energy revolution. It’s a reminder that even the greenest intentions need a strong foundation to thrive. Let’s keep an eye on California—it’s setting the stage for what’s possible in the world of clean energy.

The truth is, successful people are not ten times smarter than you. They don't really work ten times harder than you. So why are they successful? Because their dreams are so much bigger than yours!
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