Original title: Do wind and solar curtail at negative electricity prices? Incentives and evidence across two decades of German renewable support schemes
Lion Hirth · September 2026
Sometimes wind and solar farms generate more power than people use. When this happens, electricity prices turn negative, which means producers pay to sell power. Keeping the electrical grid safe and balancing prices requires these generators to shut off, or curtail, their output. Even though turning off renewables is technically easy, government subsidy programs often pay them to keep producing anyway. A researcher examined two decades of German renewable support policies. By calculating hourly financial incentives and matching them with actual generator behavior using weather records, the study tested what happens when power prices drop below -50 EUR/MWh in 2025. Almost all wind generators had a financial reason to shut down, but only half did. Meanwhile, nearly two thirds of solar generators had no incentive to turn off because fixed subsidies shielded them, and only just over a fifth of the exposed solar curtailed.
Imagine a food stall at a market. When there are too many stalls and too few customers, stall owners pay to give away food just to get rid of it. Normally, a stall owner would stop cooking to avoid losing money, but one stall receives a fixed payment per meal no matter what. So it keeps cooking even though it costs money. Here, the food stall is a wind or solar farm, the paying to give away food is negative electricity prices, and the fixed payment per meal is the flat fee that keeps solar running even when curtailment would save money.
When renewable generators keep producing at negative prices, taxpayers subsidize unnecessary electricity and grid operators face stability risks. This study shows that Germany's support schemes created a large gap between incentives and actual curtailment, especially for solar. Fixing these incentives is critical for safely scaling wind and solar.
The abstract doesn't discuss limitations, but the study is observational and limited to Germany. The estimate of market-based curtailment relies on reanalysis data which may have errors. The reported percentages are for a specific price threshold (-50 EUR/MWh) in 2025; other conditions could differ. The analysis does not explain why generators responded differently beyond the incentive structure.
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Do wind and solar curtail at negative electricity prices? Incentives and evidence across two decades of German renewable support schemes — Lion Hirth
Abstract licence: CC0
Explanation generated by Synthesis from the abstract — it is not the original paper. This is a preprint, so it hasn't necessarily been peer reviewed.