15 March 2024news

New ART solution to unlock sustainable energy

USQRisk, the only managing general agent specialising in alternative risk transfer solutions, has launched a new insurance structure to support clean energy investments. 

The solution is delivered with energy software and consulting firm Ascend Analytics. It provides benchmarking and projection data to enable USQ to structure, price, and tailor revenue protection coverage for utility-scale energy storage projects.

“This new insurance offering creates greater opportunities for the clean energy industry to gain access to more efficient financing for utility-scale energy storage projects,” said USQRisk president Michael Zipper. 

“Now, institutional investors have a more effective tool to demonstrate revenue certainty and reduce financing risk, thereby expanding the potential for the development of energy storage projects.”

The solution was developed for an investment strategy managed by UBS Asset Management’s Real Estate and Private Markets business. It will provide revenue coverage for an ERCOT (Energy Reliability Council of Texas) energy storage project scheduled to commence later this year. It can then be employed by other projects.

“We’ve seen first-hand how revenue risk is slowing the energy transition. Our new revenue protection insurance offering with USQRisk gives sophisticated investors like UBS Asset Management an alternative to traditional merchant and tolled battery financings and is an evolutionary advancement for the industry,” said Ascend Analytics managing director Adam Hise.

“Unlike other revenue protection mechanisms currently utilized in the energy storage market, this coverage aligns the interests of investors, insurers and energy storage project stakeholders by providing additional certainties to investors in utility-scale energy storage projects while preserving financial upside to the project sponsor,” added Ken-Ichi Hino, UBS AM energy storage infrastructure portfolio.

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