The Sompo group companies have launched a model for evaluating risks to onshore and offshore wind farms.
The model, which provides key pricing and cat modeling data for insuring the construction and operation of wind turbines, was created by Sompo Japan Nipponkoa Insurance Inc. (SJNK), Sompo Risk Management & Health Care Inc. (SRMHC) and Sompo Canopius AG (Sompo Canopius) in collaboration with the University of Tokyo.
Taking into account perils such as wind, lightning, wave, and electrical and mechanical breakdown, the model provides valuable risk insights to insurers as well as renewable energy companies, the companies said in a statement.
The model initially will be available for risks in Japan, followed by the North Sea and Asia later in the year.
Interest in renewable energy continues to intensify, particularly in Japan following the Fukushima nuclear disaster, with the Japanese government projecting that wind power capacity will reach 10 million kilowatts by 2030.
“In addition to providing insurance, the industry has a crucial role to play in supporting the growth of this industry with risk mitigation services,” the Sompo group companies said.
“As wind farms expand, the potential for damage increases substantially, particularly with offshore wind farm reconstruction involving considerable specialist costs,” commented Hajime Sano, head of Catastrophe Analytics at SRMHC. “This model will be of great value in diminishing and managing risk and supporting the safe expansion and operation of wind farms.”
“The quantitative evaluation of risks associated with wind farms is still in its infancy and the development of this model is an important step forward,” said Marek Shafer, head of Catastrophe Management at Sompo Canopius.
“The model offers significant potential to improve the safe construction and operation of our clients’ wind farms,” he added.