What Is Curtailment?

Curtailment is the deliberate reduction of electricity output from a generator that is capable of producing more power. In the renewable energy context, curtailment occurs when a wind farm or solar installation is instructed to reduce or shut down production even though the wind is blowing or the sun is shining. The energy that could have been generated is simply lost.

Curtailment happens for several reasons, but they all come down to the same fundamental constraint: the grid cannot absorb the electricity that the generator is capable of producing at that moment. Supply exceeds demand, and unlike most commodities, electricity cannot be cheaply stored for later use without battery infrastructure in place.

Why Curtailment Occurs

The most common cause of curtailment is transmission congestion. A wind farm in a remote area may be able to generate hundreds of megawatts, but if the transmission lines connecting it to load centers are already at capacity, the excess output has nowhere to go. The grid operator instructs the wind farm to reduce production to prevent overloading the lines.

Oversupply is another major cause. During periods of low demand and high renewable output, such as a mild, sunny spring afternoon, total generation may exceed total demand. Since the grid must be balanced in real time, something must give. Renewable generators are typically curtailed first because they have the lowest marginal cost and curtailing them does not waste fuel.

Minimum generation constraints on conventional power plants also contribute. Nuclear plants and some large thermal generators cannot easily reduce output below certain levels. If these inflexible generators are running and renewable output surges, the grid operator may curtail renewables rather than shut down a thermal plant that takes hours to restart.

Where Curtailment Is Most Common

California leads the United States in renewable curtailment, both in absolute terms and as a percentage of renewable generation. CAISO curtailed approximately 2.4 million megawatt-hours of solar and wind in 2023, enough electricity to power roughly 350,000 homes for a year. Most curtailment occurs during midday hours in spring and fall when solar output peaks and demand is moderate.

Texas is experiencing growing curtailment as wind and solar capacity outpaces transmission expansion. West Texas and the Panhandle, where wind resources are strongest, are frequently congested. ERCOT’s relatively fast interconnection process has enabled rapid renewable buildout in areas where transmission capacity has not kept pace.

The Cost of Curtailment

Curtailment represents both wasted clean energy and lost revenue for renewable generators. Developers who signed PPAs based on expected annual generation receive less revenue when their facilities are curtailed. Projects located in high-curtailment areas may become less attractive to investors, slowing the pace of new development.

For the grid as a whole, curtailment means that clean electricity that could have displaced fossil fuel generation is simply thrown away. Every curtailed megawatt-hour is a missed opportunity to reduce emissions and lower wholesale electricity costs.

Solutions to Reduce Curtailment

Battery storage is the most direct solution. Co-locating storage with renewable generators allows excess output to be captured during periods that would otherwise be curtailed and discharged later when demand rises. Transmission expansion provides a longer-term solution by increasing the capacity to move power from resource-rich areas to demand centers.

Flexible demand can also help. Encouraging electricity-intensive activities during high-renewable periods, such as EV charging, industrial processes, and hydrogen production, turns potential curtailment into productive use. Grid-enhancing technologies like dynamic line ratings can squeeze more capacity out of existing transmission infrastructure without building new lines. Reducing curtailment is essential for maximizing the economic and environmental value of renewable energy investment.