Renewable energy underwriter, GCube Insurance, has raised concerns about the increasing vulnerability of solar farms worldwide to costly hailstorm-related claims. In a report released on Wednesday, GCube revealed that hail has emerged as the most expensive category for insurance claims within the renewables sector over the last five years, averaging approximately $58.4 million per incident.
While hail incidents represent only about 1.4% of total claims, they account for more than half of the total solar loss claims, posing a significant risk to solar farms globally.
Fraser McLachlan, Chief Executive Officer of GCube, expressed the potential consequences of hail damage on the reliability of solar power as a leading clean-energy solution. He highlighted that the escalating threat from hailstorms could compromise the security of solar projects.
The report emphasizes that extreme weather events, driven by climate change, are increasingly exposing renewable projects to natural disasters. This vulnerability not only endangers existing solar installations but also raises concerns about potential delays in the global transition to cleaner energy sources and the reduction of carbon dioxide emissions.
GCube, which insures over 100 gigawatts of projects in 40 countries, notes a shift in the insurance landscape as insurers begin to reduce coverage for solar businesses due to the heightened severity of hailstorms. The repercussions include increased uncertainty surrounding future solar projects, influenced by rising premiums and higher deductibles.
As the renewable energy sector grapples with these challenges, the industry faces the imperative task of developing strategies to mitigate the impacts of extreme weather events on solar infrastructure, ensuring the continued growth and stability of clean energy initiatives worldwide.