20 April 2012
Posted in News - SPVI news
Leading firms E.on, EDF, RSA, EnBW, EDPR, Alterra, Nephila, SwissRe, Mainstream Renewable Power and JLT all looking to thrash out solutions to high-risk renewable energy investment
(April 19, 2012) LONDON – Leading developers from across wind, solar, and geothermal energy sectors, utilities investors and insurance professionals confirm their commitment to de-risking green energy and plan to attend tailor-made debates at the Renewable Energy Risk Management Europe conference in London.
In order to ensure the continued development of the renewable energy market in Europe it is critical that the investment community and the energy industry are alligned in terms of risk-profile. More and more innovative green energy start-ups are gaining a foothold in Europe, but the lack of availability of capital is a concerning trend.
Verderg’s. Mr Roberts said the weakness in the UK was the availability of risk capital to take prototypes into production, which is one reason why he travelled to the US West Coast.
“It is purely that we have talked to over 150 potential funding sources in the UK but the financial environment is unattractive at the moment. West Coast investors have a reputation for having more flexibility in their pay back horizon. This is potentially hugely profitable but it has a three to four year pay back period because of the time it takes to get the environmental approvals and in a build, own operate model. It is potentially unattractive to a classic VC.” (April 10, Richard Tyler)
A potential solution for European investor’s reluctance to absorb the high risk of renewable energy development is to make use of increasingly available insurance designed specifically for the purpose.
Swiss Re launched a product aimed at the solar market about 18 months ago. Tailor made, it is designed for the primary market and, although the company has had no claims as yet, Jürg Trüb, head of environmental and commodity markets at Swiss Re says he knows the product is often used to provide confidence to investors."There is a big demand for long-term guarantees," he adds. "The manufacturers and suppliers need to be able to guarantee the performance of the kit over a long period of time. But in many cases the product is used in the context of financing. If you are pulling together the financing it is good to have insurance in place to help cover debt servicing. Therefore, guarantees are useful." (April 5, Jakki May)
As Trub points out, the role of insurance is two-fold, both to safe-guard future potential loses, and to support a successful financing bid in the early stages of the project.
Some risks remain uninsurable for the time being and with renewable energy heavily dependent on government support, the potential for feed-in tariff reduction or removal to cause widespread pain is well documented. There are suggestions that political risk will eventually be covered and as the insurance offering rapidly evolves to meet the needs to the renewable energy market place, utilities and developers remain hopeful that the policies they are offered continue to adapt to reflect their specific challenges.
Green Power Conferences’ 3rd Renewable Energy Risk Management is the premier conference for green energy risk managers and the insurance sector that is evolving to cater to them:
· Full day and focused sessions on Derivatives and other hedging mechanisms
· Structured networking and activity roundtables
· Representation from across the value chain, from small energy developers, to utilities to industry leading insurers
· Co-located with 3rd Annual Global Wind Power Finance and Investment event, giving you access to both conferences
· 1 day in-depth course on Wind Resource Risk
More information on the forthcoming conference and the discussions to be held there is available at www.greenpowerconferences.com/riskmanagement, by following @greenpowermc on Twitter, or by joining the Renewable Energy Risk Management LinkedIn group.
Note to Editors
Green Power Conferences are pleased to welcome journalists to attend the Renewable Energy Risk Management UK 2012 Congress free of charge. To request a press pass please email email@example.com
About Green Power Conferences
Green Power Conferences is the market leader in renewable energy conferences. Since 2003, over 15,000 delegates have attended more than 300 conferences, exhibitions, workshops and training courses providing strategic business intelligence to the renewable energy and sustainability industries. Green Power’s expertise lies in producing high quality, interactive events that provide ample networking opportunities for delegates, sponsors and partners. More information and a full list of current conferences is available at: www.greenpowerconferences.com.
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