A SOLAR FARM owner in Rajasthan placed a big bet on harnessing the sun with a lump sum investment. However, as the unpredictability of the climate would have it, in 2023, the state received low sunshine on several days, resulting in the underperformance of the farm owner’s million dollar firm.
To clear the clouds over his returns, he opted for a parametric cover and now receives payout on A low sunshine days.
He’s not alone. There has been growing interest in parametric insurance among renewable energy players, including investors and lenders looking for protection against weather events like low sunshine and poor wind availability, which are uninsurable in the traditional market.
Parametric cover provides financial stability, especially at a time when weather patterns have been fluctuating due to climate change.
Pankaj Tomar, Head of India at consulting firm AXA Climate, says renewable energy is one area that is picking up very fast in terms of parametric insurance in India.
“Certain parts of India have witnessed diminishing wind and solar radiation due to climate change, which is likely to impact the country’s ambitious clean energy plans. Stakeholders will need to protect their investments and parametric insurance is clearly a viable solution,” Tomar tells BT.
All major insurance and re-insurance players have been offering parametric products for solar and wind power projects. For the first time, a product has been devised for a big hydroelectric project in Uttarakhand, hedging against risk from floods and earthquakes.
This comes at a time when lenders and investors of renewable energy assets are getting concerned about profitability.
This story is from the September 29, 2024 edition of Business Today India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the September 29, 2024 edition of Business Today India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
The EV Craze
The country’s growing luxury car market is seeing a shift with environmentally-conscious consumers betting on electric vehicles as a sustainable travel option. Though just 6%, the share of EVs in the luxury segment is rising rapidly
The Storage Boom
Data centres are being built at a frenetic pace in india as companies scramble to meet the ballooning demand from mobile phone users and firms adopting al. Can the country’s energy infrastructure keep up?
India Beckons
Owing to rising incomes in India and overall wealth expansion, luxury brands are wooing the country like never before
The Pearls of The Sea
Caviar, that rare food, is considered the epitome of fine dining. Here is everything that you need to know about it
66.Brand persona should define the core"
I’d say this was a strategic pivot. We had an iconic brand, but had, over time, evolved into diversified lines of businesses that could no longer be represented within the confines of our ‘name’.
Unwind in Style
Here is acomprehensive list of top tech picks that help you unwind by blending perfection in performance with luxury
A Lifelong Affair with Inspiration
In my art journey, the diversity of my acquisitions mirrored the expanding horizons of my understanding of art
Make it Bubbly
Champagne is much more than just a symbol of celebration and success. Know about its nuances beyond the bubbles
Palatial Splendour
Buoyed by renewed demand, sales of the glitzy mansions of the ultra-rich are surging like never before. Real estate majors are looking to capitalise on this by launching luxury offerings in record numbers
Of Beaches and Cream
GianChand Single Malt Whisky