Renewable Energy Market Review 2025
As global pressures to decarbonize mounts, the renewable energy sector continues to push boundaries. The sector is going beyond established technologies such as solar, wind and biofuels, with increasingly inventive solutions that blur the lines between science fiction and scalable infrastructure.
Insurers supporting their client’s diversification must be prepared to engage with these emerging technologies. With their novelty, will come insurability challenges, but as confidence builds and experience generates reliable performance data, insurers will be able to consider broader levels of risk transfer.
In recent months and years, new and exciting renewable energy innovation has accelerated across the globe.
Sweden has repurposed an existing black tarmac road to a permanent electrified road – the first of its kind in the world [1]. On this road, cars and trucks can recharge while driving. Dynamic charging can eliminate the key challenges of electric vehicles, such as charge time and distance limitation, which could make electric vehicles a more feasible option for drivers.
The challenge
Insurance markets are being pressured to build renewable energy into their portfolios, but prototypicality of innovative technologies such as road-powered charging or ‘e-roads’ is a major challenge. The susceptibility to damage is largely unknown, and property markets will require robust risk data to make informed decisions about building these risks into portfolios.
Research from Rutgers CAIT explores the use of piezoelectric materials to generate electricity from roadways.[2] These materials convert mechanical stress from vehicle traffic into electrical energy. Piezoelectric roadways can harvest energy from various sources, including traffic, solar, thermal and geothermal, contributing to a sustainable infrastructure framework. Similarly, kinetic pavements convert footsteps into electrical energy – ideal for stadiums, transit hubs, or high-footfall areas.
The challenge
Though output remains modest, insurers must assess risks related to wear-and-tear, water ingress and injury liability on modified surfaces.
Grid-scale energy storage solutions are designed to capture the kinetic energy produced by lifting and dropping masses. These masses are usually made from locally sourced or recycled materials to support sustainability. Gravity does the work as lowering weights releases stored energy.
The challenge
A major challenge is the loss of energy as byproducts during conversions to gravitational pull and back. Losses including heat dissipation and mechanical friction can lead to efficiencies below 70%[3], and geographical constraints can also limit scalability. With high initial costs and environmental impacts from construction and material sourcing, getting projects off the ground and managing risks are barriers to growth for gravity storage technologies.
On the marine frontier, engineers are trialing inflatable ‘bladder’ devices that float under the surface and mimic the movement of sea creatures. These flexible structures absorb wave energy as they contract and expand, converting kinetic motion into hydraulic power. Unlike rigid tidal turbines, these devices are less vulnerable to storm damage and marine corrosion.
The challenge
Structural integrity and energy yield remain key concerns for insurers and investors. Unknown risks to property damage and associated environmental damage need to be carefully modeled and mitigated.
Researchers are exploring the bioelectric properties of mycelium, the root network of fungi. Some species naturally produce small voltages as they decompose organic matter. Biotech start-up companies are experimenting with mycelium-based bio-batteries that could offer low-impact, biodegradable power sources for sensors and small electronics. While still in its infancy, this area exemplifies the creative thinking behind sustainable micro-energy solutions.
The challenge
Aside from technical challenges, property needs and scientific knowledge gaps, bioelectric solutions are perceived as prototypical by the insurance markets, and the technology will need to prove to be commercially scalable with robust engineering and analytical models before they can be built into portfolios.
Alongside modular fission reactors, global focus is intensifying on nuclear fusion. In its quest to make clean, limitless energy a reality, China’s artificial sun project has achieved record temperatures which are five-times hotter than the core of the sun[4].
The challenge
While commercial viability is years away, fusion technology brings new frontiers of risk, including high-energy magnetic confinement, tritium handling and long-term containment planning. Insurers will need to prepare for entirely new frameworks around liability, regulation and performance coverages.
As these weird and wonderful technologies move from concept to pilot phase, they bring with them a host of challenges: mechanical reliability; long-term degradation; unpredictable yield; and lack of performance benchmarks. All these challenges complicate traditional actuarial models. But risk also brings opportunity. Innovations in renewable energy technologies represent exciting new classes of insurable assets for early movers in the renewable energy insurance market.
For insurers, the message is clear. The future of renewable energy won’t just be wind and sun, it will be the road, the sea, the soil beneath us and even the fungi underfoot.
Being an early mover will be high risk but could be high reward. For forward-thinking renewable energy companies, a robust risk management strategy will need to account for agility as the risks associated with new technologies come to the fore, and insurance market dynamics respond. The role of a broker will be critical in enabling insurers to understand the risks, backed by data, and collaborate on building solutions to drive the clean energy transition forward.
Opportunities in renewable energy technologies are there for the taking, download the full article to find out more about insurance and risk strategies to support innovation.
| Title | File Type | File Size |
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| Weird and wonderful: The next wave of renewable energy innovation | .6 MB |
