Scaling Utility Solar At Risk From Single-Point-Of-Failure Losses

By Green Partners Adjusting

Green Partners Adjusting warns that transmission failures and outdated policy terms are leaving asset owners exposed

London, 10^th  November 2025 – Green Partners Adjusting (GPA), the specialist renewable energy loss adjusting firm, has warned of rising exposure for investors, lenders and asset owners as solar projects scale in capacity and revenue.

In the last fifteen years, European solar projects have grown from having average nameplate capacities of 10 – 20MW, to developments that are over 250MW, today – with plants of 100MW capacity now being typical. While solar has become the dominant renewable technology of the energy transition, this rapid growth means that any interruption to site wide power export now carries far greater financial impact for owners and investors than it has done historically.

GPA’s analysis shows that the largest business interruption losses are no longer caused by equipment within the project’s control, such as onsite power generation or inverters, but by Contingent Business Interruption (CBI) – when the failure of third party-owned grid or transmission equipment prevents power export. These failures, typically occurring at the point of interconnection, can take entire sites offline, resulting in a total revenue loss even though the asset itself remains intact.

And while a single point failure on equipment owned by the project can be equally impactful, the owners have the potential ability to recoup some of the revenue losses through the availability guarantee provided by the Operations & Maintenance contract. During a CBI claim, however, it is unlikely that this method of project recompense is available to the project owners. This both increases the solar project’s potential loss exposure and limits the avenues available to transfer risk.

For typical direct Business Interruption (BI) losses – where there is a covered physical damage loss on the Insured’s own equipment – most insurance programmes would provide cover for up to 12 months of lost income, with a 20-30 day waiting period or average daily value deductible applied. And while CBI cover is generally offered with the same insurance terms as standard BI, longer deductibles of 45 – 60 days, or limitations applied at 6-months for lost income, or on total financial compensation may be enforced.

This means that for the larger sites now in development and construction, even a 30-day gap between an incident and policy coverage – or an incident outside the scope of a policy – can create multi-million differences in ultimate claim compensation, which may be particularly exacerbated if a loss occurs during the higher production periods.

“The insurance policy structures in use today were written when solar farms averaged 5–10 MW,” said Nicholas Baker, Founding Partner, Green Partners Adjusting. “Projects are now 20 times that size, or more, yet coverage wordings and deductible frameworks have barely evolved. Even with a 20-day waiting period, owners are carrying six- and seven-figure losses before insurance responds.”

The issue is compounded by the fact that grid operators control the repair schedule and rarely share cause-of-failure information, leaving owners unable to mitigate delays or establish clear route cause still needed to trigger insurance policies. GPA advises project developers and investors to engage early with grid operators to establish contingency plans, agree access to spares, and understand potential outage scenarios.

GPA also highlights that loss severity varies sharply with seasonality: downtime during high-irradiance summer months can multiply revenue losses several-fold. The firm’s analysis shows that a 373 MW project – currently the largest operational site in the UK – could face an estimated £10.8 million summer loss over a 60-day period.

*Largest operational UK project
**Largest project with UK planning approval

Baker added: “In our view, deductible length is the most critical area for review given that, in practice, most grid equipment faults are repaired long before a six- or 12-month indemnity limit would expire, meaning the real exposure for owners lies in the first 30 to 60 days when cover may not yet respond. By shortening waiting periods or creating new deductible structures, insurers can better align policy design with how modern solar projects actually operate, enhancing asset protection and delivering fairer balance of risk between owners and insurers.”

George Pooley, Managing Partner, commented: “Solar projects continue to grow in scale and sophistication, yet policy language hasn’t caught up. We’re encouraging developers and insurers to collaborate on modernising CBI terms to reflect today’s market reality – and to ensure that risk-transfer solutions evolve in step with the energy transition.”