Overcast

Effect
While exhausted, a character's maximum energy supply is reduced. Whenever a spell causing exhaustion is cast, the caster loses 10 maximum energy. The amount of maximum energy lost is shown at the right end of the energy bar as greyed out. Maximum energy lost to exhaustion will be restored at a rate of 1 point every 3 seconds.

Exhaustion does stack. If a character casts several spells that cause exhaustion in succession, his maximum energy supply will become severely reduced. Exhaustion can actually cause maximum energy to drop below zero. In this case, the deficit must be regained at 1 point per 3 seconds before actually regaining maximum energy.

Source
Exhaustion is usually only self-imposed by certain elementalist spells. The effect of exhaustion is triggered when an exhaustion-causing spell begins casting, not once the spell has been successfully cast, so cancelling casting or being interrupted will not prevent exhaustion. The following is a list of elementalist spells that cause exhaustion:
 * Energy Storage Skills: Ether Prodigy
 * Air Magic Skills: Chain Lightning, Lightning Surge, Gale, Mind Shock, Shock
 * Earth Magic Skills: Earthquake, Obsidian Flame
 * Fire Magic Skills: Meteor Shower, Mind Burn, Meteor
 * Water Magic Skills: Maelstrom, Mind Freeze

In addition, Glint has a hex that causes all of the hexed character's spells to cause exhaustion, that hex is called Crystal Haze.

Removal
Dying or changing zones will remove all exhaustion. The only other method is the natural regeneration of 1 maximum energy per 3 seconds.

Prevention
Glyph of Energy prevents your next spell cast from causing exhaustion.