A new report by insurance and reinsurance marketplace Lloyd’s of London has identified growing opportunities for re/insurers to innovate products and support the renewable technologies industry.
In 2018, China, the US, Europe and India invested more than £230 billion in new renewable energy, while total investment in the power sector has begun to outstrip investment in the oil and gas sector for the first time in decades.
This has helped to drive the rapid development of renewable technologies, through standardisation in wind and solar, and economies of scale.
Working in collaboration with the Imperial College London Centre for Energy Policy and Technology, Lloyd’s has assessed the implications of this growth and the key emerging risks for insurers and risk managers.
“Due to the changing nature of risks in the sector and the fact that insurance is often a pre-requisite for securing project finance there is a growing need for insurance to support the rapid growth in the renewables industry,” the report stated.
“With energy capacity increasing, technologies maturing, and more data to analyse associated risks, the renewable energy market will open to further insurance business and product development.”
The research concluded that China is a key territory for renewable energy systems, with 334 Gigawatts of installed renewable technologies.
Lloyd’s noted that China has the largest capacity for any one country and produces a significant percentage of renewable technologies, for example 45% of global solar photovoltaic panels.
Solar photovoltaics also dominate technological growth with an estimated 575 Gigawatts set to become operational in the next five years.
The report further said that lithium-ion batteries look to be the storage technology that will dominate future deployment of energy storage systems, with an 85% decrease in production price over the last decade, as well as better production methods and improved understanding of risks.
