Renewable Energy Exposures
The Problem: Renewable energy projects involve potentially overlapping environmental as well as energy related property and liability exposures. The complex set of contracts involved in such projects, including power purchase agreements (PPAs), also determines how risks and exposures will be allocated. In addition, combining renewable energy with brownfields projects/sites may create unique combinations of risks that do not diminish over time. Solar or wind operations may damage engineering controls that are part of a remedy, and PPA’s often have 20 year terms.
The Solution: EIA can:
- Tailor an insurance program integrating manuscripted site pollution liability policies for brownfields risks with and customized property/liability policies issued by the Energy Department of an A+ rated insurance company.
- Provide long-term insurance coverage: SPL policy has institutional/engineering controls coverage and is automatically renewable after 10 years; property and CGL policies have rates locked in for several years at a time.
- Structure the transaction including integrating the environmental contracts and insurance with the overall PPA and related contracts.
- Arrange long term loss control based on monitoring and annual certification of institutional/engineering controls and green building/renewable energy compliance.
Renewable Energy Projects on Contaminated Property: Managing the Risks
Managing brownfields risks requires complex technical and legal analysis. Analyzing risks in renewable energy projects is equally complex. Both projects involve several contracts that must be integrated and made consistent with each other. Combining these types of projects creates a unique combination of risks,including, for sites where institutional/engineering controls are part of the remedy, risks that will not diminish over time.