Sciemus

Keeping the Lights On - Sciemus Publishes Article with Insurance Insider

Press Release   •   Jul 25, 2012 09:27 BST

Sciemus have published an article focused on the quantification of risk in the renewable energy sector, the article was released last month for the 2012 edition of the Insurance Insider Global Energy & Power Review.   

Intro

"The massive increase of installed worldwide wind energy capacity during the mid-to-late 2000s created a seller’s market for the dominant turbine suppliers as demand outstripped supply and order books were forward filled many years in advance.

These market conditions facilitated two fundamental changes to the initial warranty provision. Firstly, warranty periods shrunk from a typical cover of 12 years to around five, and secondly, turbine suppliers took ownership of specific data streams regarding asset reliability – and in doing so created an imbalance of data transparency to external stakeholders such as insurance carriers.   This has resulted in the insurance market being increasingly forced to write risks without warranty coverage as the post-2005 vintage machines start to exit their initial warranty period – and with little data to support the pricing of post-warranty risk."