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Wholesale electricity prices regularly drop below zero in parts of the US, which means producers pay consumers to take their power. It happens for straightforward reasons, and it's getting more common as solar and wind grow.
Electricity has one unusual property: the grid must consume exactly what it produces, every second. There's no warehouse. So when a sunny, windy spring afternoon floods a low-demand grid with renewable power, someone has to either back off or pay to keep producing.
Three rational reasons. Some plants are brutally expensive to stop and restart, so riding out a negative hour is cheaper than cycling off. Some renewables earn tax credits or contract payments per megawatt-hour produced, so they still net positive revenue at moderately negative prices. And some plants must stay online for reliability reasons regardless of price.
When enough such producers bid negative, the market clears negative. The auction is working exactly as designed; the bids themselves are just below zero.
California's solar belly is the classic case: so much midday sun that prices at some nodes dip below zero, then swing to the day's peak three hours later as the sun sets and everyone comes home. That daily shape is the famous duck curve. West Texas wind at 3am produces the same effect on the other side of the country.
Batteries, mostly. During a negative-price hour a battery gets paid to charge. Buy at −$5, sell into the evening peak at $80, and the spread covers a lot of hardware. This arbitrage is a big part of why grid batteries are being built faster than any other power asset in the country, and why they cluster at nodes where the swings are biggest.
Negative prices show up regularly on our live California price map. We never clip them: if the market prints −$12, the API returns −$12, because that number is the whole story.
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