alt Hacker NewsIn theory that works as long as you're willing to let the price reflect actual supply and demand even when the difference is very large, e.g. it has been cloudy and still for a couple weeks so the batteries are low and then you get a hot summer day or cold winter night with a lot of demand. No problem, we'll just set the price to "high enough to get people to stop cooling/heating their buildings" and the market will clear. But people aren't going to like that.
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The demand can be more elastic than you envision. If power is expensive on a given day, electric cars can wait to charge, or even discharge if they aren't going to be used. People can wait to run laundry dryers.
The market will incentivize actors to smooth out before those kinds of restrictions are necessary.
People might not like changing their habits to follow the energy, but they'll probably be pretty happy when the end result is both good for the environment and cheaper overall. At least in my corner of the Midwest, either the sun is shining or the wind is blowing, and often both.
It’s not something that’s likely to happen at the retail level, but at the industrial level. Battery farms buying power when the price is low or negative (due to too much wind/solar) and selling when the price is higher (early evening). Aluminum smelters curtailing. Etc.
There is something interesting happening in the retail space, though, called a “virtual power plant.” Worth googling if you’re curious.