It is shown that the local Joule heating due to planar defects, such as gra
in boundaries, microcracks, etc., can cause thermal instabilities, which li
mit the current-carrying capability of YBa2Cu3O7-coated conductors. Explici
t instability criteria are obtained for a planar defect in a film and for a
grain boundary. Thermal instabilities can be triggered by low-angle grain
boundaries or planar defects, which block only a small fraction of the samp
le cross section. Hot spots near small defects and overheating of grain bou
ndaries are essential for interpretation of experimental data on ac losses
and E-J curves of polycrystals. (C) 2001 American Institute of Physics.