emerging risks briefing
Tom Pocklington,Hull & Liability Underwrite , RSA
“Our approach to ensuring commercial energy operations is to bring together expertise from our marine, renewables, construction, power and engineering businesses. it is vital to use all these skills in looking at marine based or‘wet renewables’.
“We were one of the rst insurers to cover the development of wind technology 30 years ago and are now world leaders in the eld. We believe that wave and tidal energy is at a crucial point of development.The potential for energy generation and current political climate means it could be a major source of the Uk supply in the future.
“naturally, to make the technology viable we need to work together with the industry and other stakeholders to create installations which are low risk, both from a commercial stance and environmental.”
Growing wet renewable potential renewable energy is set to play a key part in the Uk’s future energy strategy, with britain potentially becoming the saudi arabia of wave power.The Uk is aiming to achieve a 20% target of renewable energy production by 2020.The recent leasing of sites by the crown estate is projected to generate 1.2gW of installed capacity, enough for 750,000 homes.
The UK owns 50% of Europe’s tidal energy resource and 10-15% of the global resource
The UK owns 35% of Europe’s wave energy resource
The UK could get 10-15% of its energy demand from wave power
Trading carbon Magazine
Beyond protoypes rsa is the market leader in global renewable energy insurance. rsa covers insurance for renewable energy projects at every stage of development, from plan, to test site, to construction through to operation, and we are one of the few insurers to offer both onshore and offshore cover for wind energy projects.
as well as centres of excellence in solar, biomass and small scale hydro-electric power, rsa has a leading marine insurance capability.This is particularly important when it comes to wave and tidal power and developing a full renewable energy proposition.
Wave and tidal technology is relatively new and there is a high degree of uncertainty over how it will perform in some very challenging ocean environments. naturally, this increases the degree of risk but the big potential advantage is the predictability of the tides over wind and solar for power generation.
emerging risks briefing
Moving to commercial use The rst commercial facilities are starting to open with a wave farm in 2008 in portugal.a tidal energy installation was rst connected to a national power grid in norway in 2003 and a device in northern ireland is the rst commercial scale device of just over 1.2 mw. devices are currently being tested at a specially designated facility off the Orkney isles with full scale commercially operational sites expected off the Uk coast by 2012.
it becomes easier to manage the risks associated with tidal and wave energy as more commercial devices open.With more detailed knowledge of the risks and claims data being built up the underwriting of wind and tidal energy becomes more competitive.
Environmental dilemma While most commercial devices are small-scale installations, the potential for bigger farms are being considered.The potential environmental impact also
increases with the size of installation with greater care and attention needed to how it affects local ecosystems.This raises the question of whether a trade-off needs to be made between local environmental impact and the reduction of greenhouse gases from a renewable energy source.
The proposed severn estuary barrage was estimated as having the potential to generate 5% of the Uk’s electricity(1).The ten mile long hard engineered barrage would have crossed the entire river severn.While the project would have contributed to reducing the Uk carbon emissions it was widely criticised by environmental groups.The initial proposal was expected to impact habitats for birds, restrict large tanker trafc and possibly increase ooding.alternatives are being considered using less intrusive tidal energy lagoons with a much smaller impact and a 12 mile long tidal reef to try and balance the interests of all stakeholders.
(1) department of energy and climate change
Reduced carbon intensity
Marine species impact
Connections to grid
Energy security drive
20% production target by 2020
Restrictions on coal plants
Potential cost effective energy
High risk for losses
Potential future economic losses from energy