industrial solar power plant solar solar energy solar power plant Solar Power Plant Insurance

Importance of Insuring Industrial Solar Power Plants

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One of the main advantages of installing a Solar Power Plant is that it ensures power generation for 25 years. This implies that it not only aids solar power plant owners to save on electricity bills for the next 25 years but also protects the owners against rising power costs.

For all the advantages that it provides the Solar Power Plant has to successfully withstand all kinds of challenges in its lifetime to guarantee efficient power generation. Some of the challenges that the Solar Power Plant might face are as follows:

  1. Risks associated with changing weather patterns brought about by climate change. These include high wind speeds, hail storms, heavy rainfall etc
  2. Fires that may arise due to unforeseeable reasons
  3. Theft of Solar Power Plant components and equipment like solar panels, inverters, structures etc.
  4. External damage caused due to unforeseen reasons
  5. Equipment failure

To ensure safety against the above-mentioned challenges, it is necessary that Solar Power Plant owners get their systems insured. This will ensure the safety of the solar power plant from various risks and protect the owner or prosumer1 from incurring high losses caused due to costly repairs and replacements, should these risks ever become a reality.

Although various components of the Solar Power Plant come with warranties but due to the above-mentioned reasons it is essential that solar power plant owners consider opting for an insurance plan well suited to their needs and expectations.

Insurance providers are now catering for various scenarios that may arise. Some of these insurance options are as follows:

  1. Bucak Contract Works: This plan covers against losses that may arise from the damage to property caused during the development of the solar power plant project. This cover encompasses the period between the transit of the solar power plant components till the plant development is complete and handed over to the owner of the power plant or the prosumer.
  2. Property Damage: This covers all risks such as property damage caused due to fire, natural calamities etc.
  3. Machinery Breakdown: This covers any mechanical or electrical breakdown of any equipment or component of the solar power plant that may result in expensive repair work or replacement of damaged solar panels.
  4. Business Works: This covers operational downtime brought about by factors that have been insured against like fire or damage caused due to storm, machinery or equipment failure etc.

Some of the major solar insurance providers that have been approved by the MNRE2 in consultation with the IRDAI3 are as follows:

  1. IFFCO Tokio GICC
  2. HDFC Ergo GICL
  3. New India Assurance Co. Ltd.
  4. ICICI Lombard GICL
  5. Cholamandalam MSGICL

Various products that are offered by the above insurance providers are as follows:

  1. Photovoltaic Buyers Policy
  2. Solar Panel Warranty Insurance
  3. New India Solar Energy Insurance Policy
  4. Solar Panel Warranty Insurance
  5. Solar Energy Shortfall Insurance Policy
  6. Chola Solar Plant Protect Policy

1prosumer: A prosumer is an individual who both consumes and produces.

2MNRE: Ministry of New and Renewable Energy

3IRDAI: Insurance Regulatory and Development Authority

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