Micro Renewable schemes require specialist insurance measures
Initial indications suggest Feed in Tariffs (FiT) are already succeeding in boosting interest from landowners in the development of small scale renewable energy schemes according to insurance brokers Lycetts.
Colin Sadler, Divisional Director with Lycetts Commercial division said: "We have noticed a definite rise in the number of enquiries from landowners looking to carry out feasibility studies for hydro schemes, anaerobic digesters, wind turbines, solar photovoltaic schemes or micro combined heat and power plants since the announcement of the FiT payments".
One likely factor behind this growth in interest is the financial certainty offered by the scheme. Once tied in landowners are guaranteed a fixed income for the next 20 years. This makes it much easier to secure finance. Also, with interest rates currently running at such low levels and with investors looking at a potential payback period of around five years for smaller scale developments, the figures look appealing to those with a suitable site for such a scheme.
Such is the growth in demand in renewable energy schemes Lycetts is launching a bespoke insurance package aimed at these smaller scale producers.
"Existing insurance policies have tended to be aimed primarily at the big utility companies and large scale renewable energy producers, so are not really suitable for smaller scale projects," continued Sadler. "These schemes can show huge variations in size, type, output and location. This means they all have differing insurance requirements, some of which might already be covered by an existing farms and estate policy. Having worked on numerous such projects with existing clients and carried out extensive research, a bespoke policy has been developed which can be personally tailored to suit individual requirements."
"While public and employment liability may be covered by existing policies, loss of income from machinery failure or damage will not. Neither will issues causing construction delays which may affect repayments, all of which can be catered for under the new policy."
"In most cases landowners will be starting such projects from scratch, overseeing everything from planning and development to financing, project management and operation. The policy we have developed therefore covers the entire development process, from the cradle to the grave so to speak, in addition to on-going running procedures once operational. As far as we know we are the only brokers to offer such a specialist but flexible policy and its possible landowners with existing renewable energy projects may find this policy better than their current arrangements. "
