Recurring issues

One such issue that continues to cause consternation for insurers is the naming of contractors under insureds’ policies, absolving contractors of responsibility for claims made under that policy. This issue is compounded by the continuing race for larger, more productive turbines. As turbines change both in terms of models and “uprating”, contractors may not have a complete understanding of a model, which can lead to errors. Because the ability for contractors to claim under the project owner's main insurance contract reduces the incentive for contractors to reduce errors and improve risk management, the increased likelihood of claims instead can force stricter terms and conditions on a project owner's insurance policy.

The wind energy sector is not immune to global supply chain issues. In the US, for example, a shortage in locally flagged vessels means the industry is reliant on a small fleet of vessels and, as the industry grows, there is great concern about the availability of vessels to complete projects. Vessels can take several years to build and require investment of hundreds of millions of dollars and more. Add to that the need for port upgrades, Jones Act restrictions and the need for new local manufacturing facilities and it is clear there are challenges for the US to meet its 30GW by 2030 target. This situation is not unique to the US markets; emerging markets such as Australia, Brazil and the Baltics also need to solve this issue.