Swiss Re Corporate Solutions Announces Insurtech Collaboration to Accelerate Solar Adoption
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Swiss Re Corporate Solutions (SRCS) today announced an agency agreement with kWh Analytics to accelerate the growth of solar energy.
The Solar Revenue Put – a product created by kWh Analytics and underwritten by SRCS – encourages the development of clean, low-cost solar energy by driving down investment risk. This collaboration officially marks our principal risk taking in the North American solar market, further building on our landmark 2018 thermal coal commitment to reduce worldwide greenhouse gas emissions.
This partnership reflects an emerging insurance industry trend wherein new categories of insurance products are enabled through collaboration between innovative startups and experienced insurers. The first-ever Solar Revenue Put was transacted in December 2017 on three solar power plants owned by Coronal Energy, a Panasonic affiliate. The Solar Revenue Put has now been structured on $1B of solar capacity.
Speaking about the agreement, Ivan Gonzalez, CEO North America Corporate Solutions, said: "As we strive to make the world more resilient, we prioritise risk transfer solutions that enable sustainable progress for our customers and our communities. This agreement helps further that commitment and establishes an entirely new category of risk management products based on kWh Analytics' industry-leading solar power data repository."
"In the solar business, risk is cost. In fact, the cost of capital is the single largest cost to a solar power plant. Using data, we are reducing that risk," says Richard Matsui, CEO of kWh Analytics. "Investors have long sought assurance that solar power plants will perform as promised. With kWh Analytics and Swiss Re Corporate Solutions now protecting their investments, stakeholders are better able to invest the hundreds of billions of dollars that the solar industry requires in the next three years. SRCS seized the opportunity to build a lead in insuring the world's fastest growing source of energy."
Solar power was the world's fastest growing source of new energy last year, eclipsing wind power, hydro power, and even natural gas, according to the International Energy Agency. By 2025, McKinsey & Company estimates that the burgeoning solar power industry will require $1 Trillion of investment capital to finance the construction of new solar power plants. The Solar Revenue Put enables banks to efficiently finance solar assets, thereby reducing the cost of solar and accelerating solar adoption at scale.