The maximum real-time LMP spread in CAISO hit $787.27/MWh on July 9, 2026, at 10:15 UTC. The gap between Dunnside at $48.53/MWh and Bishop at -$738.75/MWh is not a pricing anomaly. It is a transmission constraint signal with a congestion component of -$765.33/MWh at Bishop, meaning the node is paying nearly $766/MWh to stay online.

The mechanism is straightforward. Dunnside's congestion component was a modest $15.09/MWh. Bishop's was -$765.33/MWh, with energy at $19.34/MWh and losses at -$5.11/MWh. The negative LMP means generation at Bishop must pay to export. This is classic renewable oversupply in a constrained export path, compounded by battery storage behavior. CAISO logged 1,668 curtailment events in the prior seven days. The CPUC modified battery storage rules on July 8 to address "foldback" — the phenomenon where storage resources withdraw from charging during negative prices, removing the only local demand sink and driving prices even lower. The timing is tight: the rule change was one day before the $787 spread.

Traders should watch two things. First, the Dunnside-Bishop spread widens if solar irradiance is high and battery state-of-charge is full at the same transmission constraint. Second, the CPUC foldback rule may reduce the severity of future negative price events, but the first test will be the next high-solar, low-load weekend. If Bishop repeats -$738/MWh under the new rules, the problem is physical, not behavioral.

> A $787/MWh intraday spread is not a pricing error; it is a transmission constraint priced correctly, and the CPUC's foldback fix will be tested the next time solar oversupply meets full batteries.

Not investment advice. For informational purposes only.