One of the recurring themes discussed at Energy Insurance London this week was the evolving nature of risk within the renewable energy sector. As the industry matures, insurers, brokers and asset owners are increasingly recognising the importance of ensuring insurance values accurately reflect the true cost of rebuilding renewable energy assets.
Replacement Is Often More Economical Than Repair
Unlike many traditional industrial assets, renewable energy equipment is frequently more cost-effective to replace than repair.
Wind turbine components such as the switchgear often require specialist engineering and heavy lifting equipment. Repairing these components can quickly become uneconomical, particularly when factoring in prolonged business interruption.
However, replacing equipment involves far more than simply purchasing a new component.
A true reinstatement cost should include:
- Specialist cranes and installation equipment
- Transportation and logistics
-
Civil engineering works
- Professional fees
- Debris removal
These costs can represent a substantial proportion of the overall claim and are often underestimated when insurance values are not reviewed regularly.
Supply Chain Challenges Make Accurate Values Even More Important
Global supply chains continue to influence the renewable energy sector.
Major components such as wind turbine blades, transformers and electrical equipment can have lead times stretching to 28 months. Following a widespread weather event, which are increasing and becoming more unpredictable, demand for replacement equipment may exceed available supply, increasing both costs and business interruption. With business interruption being 45% of claims for Wind Farms.
Technology Moves Faster Than Insurance Values
Renewable energy technology has evolved rapidly over the last two decades.
An example we see often is with damaged solar panels. These are typically replaced rather than repaired, as if one panel in a row of thirty is damaged, advances in technology may mean an identical replacement is no longer available. Potentially requiring multiple panels in the same circuit to be replaced.
A like-for-like replacement is rarely possible.
Construction Costs Continue to Evolve
The cost of reinstating renewable energy infrastructure is influenced by numerous market factors, including steel and copper prices, labour availability and exchange rates.
Even modest increases across these areas can significantly affect the overall reinstatement cost of a renewable energy project.
A valuation completed several years ago will no longer provide an accurate basis for insurance.
Protecting Long-Term Investments
With the renewable energy market now over 20 years old, more assets are ageing and accurate valuations are becoming essential.
This is a challenge Rushton is helping clients address across the globe. During the first half of 2026, we have completed reinstatement valuations for battery energy storage system (BESS) sites in Australia, wind farms in South Africa and solar farms in Qatar. We valued several hard-to-reach renewable energy assets remotely from the desk. Providing clients with a practical and efficient solution, without compromising the quality or accuracy of the valuation.
As demand for renewable energy portfolios continue to grow, ensuring reinstatement values remain accurate is fundamental to maintaining effective insurance protection and safeguarding long-term investment.
