Reinsurance company Munich Re introduces battery performance insurance
Clean Energy Wire
German reinsurance heavyweight Munich Re has introduced an insurance for operators of battery storage installations that shields them against the risk of their products not performing as advertised. The company will issue performance warranties for up to ten years to “unburden the balance sheets” by compensating battery producers for all maintenance or repair costs of batteries that exceed a predetermined amount. “The [insurance] product makes it significantly easier for manufacturers to ramp up deployment of battery capacities, thus making renewable energy more dependable and widely available,” the company says in a press release. Munich Re says the insurance is primarily aimed at large-scale battery projects, for example to ensure grid stability or to cover peak demand periods, but will be extended to the mobility market in a second phase.
Expanding energy storage capacity is seen as a key step for the energy transition’s progress in Germany and elsewhere, with the market for storage solutions expected to grow rapidly in the next few years. Like other insurance companies, MunichRe last year announced it would gradually phase-out its business activities in the fossil fuel sector and focus on projects that are more compatible with emissions reduction targets.
