Photovoltaic power plant risk factors and insurance agency

Polaris solar PV net news: 1, site risk: storms and lightning; freezing, snow and hail pollution dust; rock fall; geology landslide; earthquake flood; a shaded animal bite damage.

2, technical risks: design flaws; equipment failure; attenuation; age; maintain; repair; replacement; appearance; accessibility.

3, the installation of risk: to receive materials; material handling;; fixed connection cable arrangement.

4, security risk: shock; arc; fire; static load; load; theft; vandalism; the safety of the operator.

5, material risk: key materials supporting materials auxiliary materials; delays in delivery, transport damage.

Graph below is based on accident frequency of PV power plant risk assessment-Germany experience:

Below is based on the amount of compensation for losses of PV power plant risk assessment-Germany experience

Property and casualty insurance

1, the direct insurance

Property all risks insurance: underwriting of natural disasters, accidents and other PV power plant caused by property damage.

2, consequential loss insurance

Disruptions and extra expense insurance: this covers natural disasters, accidents and other causes indirect loss of PV power station outages, including electricity and subsidies and an increase in the fixed costs of the derogation.

3, delay insurance: underwriting of PV power station construction period of indirect losses caused by delay in completion, including the increase in interest on loans and fixed costs

Liability insurance

1, commercial general liability insurance: this covers commercial, except the employer’s liability and motor vehicle liability liability risks, including premises, operations, product and project completion, losses arising from the liability.

2, umbrella liability insurance: the super compensation of commercial general liability insurance policy, providing high limits of liability protection for PV power plant.

Quality assurance insurance

1, PV module quality assurance insurance: due to defects in materials and manufacturing workmanship for PV modules offer repairs, return guarantee for 25 years.

2, PV system surety: for photovoltaic systems (including inverters, combiner box, tracking systems, and so on) from material and workmanship defects for ten-year repair, replacement guarantee.

Weather derivatives

Weather derivatives to hedge electricity power generation system with weather variability in the effect of financial instruments. Solar photovoltaic power station of weather derivatives to hedge is the abnormal changes in solar irradiance.

Weather derivative risk is the essence of solar PV power station holder with risk of acquisition of bilateral or multilateral trade agreements, namely acquisition risk compensation for negative impacts of specific weather events.

Weather derivatives are similar to insurance, but the pricing and trading in financial markets.

Weather derivatives in the energy sector are mainly used to hedge the price risk of weather-related. In the renewable energy industry, weather derivatives is limited, most of the transactions took place in the fields of wind power and hydropower, photovoltaic applications in the field of less.

Other financial derivatives

1, catastrophe bonds

Catastrophic risk insurance companies unwilling to undertake it by issuing catastrophe bonds into financial markets. Renewable energy industries, Shang unreleased catastrophe bonds.

2, captive insurance company

Owned or controlled by non-insurance companies insurance companies in order to provide insurance for certain risks of the parent company. 2010 United States insurance broker BeecherCarlson have tried to set up captive insurance companies for a photovoltaic power plant.

3, asset securitisation

PV asset securitization is a financing method. Poor’s and Fitch, agreed that, in the absence of historical data, photovoltaic power plant asset securitization is still facing many challenges.

Original title: photovoltaic power plant risk factors and insurance agency

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