What happens if the load on the electrical generator exceeds its generation power? And why? What happens if the load on the electrical generator exceeds its power generation? and why?
To be more precise, suppose we have a standard induction generator operating at frequency $\nu=50\:\mathrm{Hz}$ and voltage $V_0$, and rated to produce a maximum power $P_0$, and that we connect this to a load $R<V_0^2/P_0$, which will try to draw more power than the generator's capacity. Obviously the details will depend on the type of generator, but, generally speaking: what will be the generator's response, and what physical processes are involved?
 A: As the current drawn by the load increases the torque opposing the motion of the prime mover on its coils increase. This opposing torque is a result of the force acting on the coil since it's a current carrying conductor moving in a magnetic field. Hence its rpm reduces and so does its voltage output.
A: The generator circuit breaker should trip to avoid damage.  But if that doesn't work, or doesn't exist, the generator will not be able to maintain its speed.  On a typical AC system, this will cause the frequency to drop from the standard 50 or 60 Hz, as well as drop the output voltage.
A: If the generator's power source exceeds the generator's capacity, and if a load is placed on the generator that also exceeds the generator's capacity, and if all safety devices are disabled; the generator would heated up to a point where the weakest link would burn out like a fuse and thus remove the electrical load. 
A: just decelerates and finally stops because of heat-induced physical deformations; because the load is always against the power of the engine. The engine always has limited work ability because of limited energy and so power.
