How can the new electricity glut in California hurt consumers?

They are now selling excess power at reduced rates.
Before they were buying at excessive rates.
I can understand the later costing more, but the former sounds like a manufactured problem- any surplus must reduce consumer bills, even if it sells for very little. Extra is extra.

The State of California arranged to purchase power from multiple providers when the crunch looked really bad. They signed long-term contracts in order to get the lowest prices they could.

Those contracts now require California to purchase power at those rates, even if the usage is too low to justify buying any additional power. Since the contract requires the state to buy the power, if California has no use for it, it must try to find a buyer. If there is sufficient power everywhere else, then that power is not needed and the price drops. California thus pays more than it needs to, but must sell at lower than the purchase price.

We already paid for it but now its worth a lot less. The state has to take money from the schools, Etc to pay for it & they are doing that.