How risk engineering can unlock the full value of clean energy projects

Key takeaways

1. Risk strategies need to respond to changing exposures of new technologies in new geographies
2. Prototypical technologies create unknowns for insurance markets, but projects are not normally uninsurable
3. Businesses are financing clean energy projects internally, and risk strategies need to protect business’ balance sheets
4. Risk engineering can deliver clarity on loss scenarios, demystify prototypical technology, and help natural resources companies protect their balance sheets as they plan the next steps in their clean energy strategy

Investment in clean energy technologies is set to increase by over a third (34%) from the last financial year (2024 to 2025). But according to our Global Risk Engineering Leader, Alan McShane, these investments aren’t yet emerging onsite in the traditionally high carbon-emitting industry sectors.

Which of the following best describes the current stage of your organization's clean energy strategy?

Different natural resources sectors are at different stages of their clean energy implementation strategy. In our Global Clean Energy Survey 2025, where a sample of 450 natural resources companies shared their clean energy priorities and plans, most respondents are clustered in developing, documenting and embedding a clean energy strategy.

With just 13% at the fully implemented stage, it’s unsurprising that a majority of clean energy investments are yet to be visible onsite. There are significant pressures acting on decision-makers, with geopolitical headwinds, trade tensions, macroeconomic volatility, supply and demand dynamics, and stakeholder pressures all intensifying. The cumulative effect is that the natural resources industry is at a tipping point. The need for a low-carbon economy remains fundamental to achieving the decarbonization targets set out in the Paris Agreement, but shorter-term pressures to protect and grow revenue streams through traditional oil, gas, chemical, mining and power processes, plus the increased focus on energy security are pulling decision-makers in different directions.

Delaying decisions to invest in clean energy technologies could result in lost opportunities, reducing market share and ultimately profitability. For risk leaders, making informed data-driven decisions can enable businesses to take these investment decisions earlier and with greater confidence.

Balancing cost and value of clean energy: The role of risk engineering

In a competitive industry, clean energy investments must have a demonstrable role in enabling the company to generate revenue.

The intricacies of what risk exposures mean will be unique to each natural resources company amid the clean energy transition – whether the organization is a small start-up enterprise right through to major multinational players.

While these nuances differ in the detail, major themes driving these risk exposures remain consistent:

• Clean energy projects are expanding companies’ operations into new geographies that are exposed to new risks such as elevated natural catastrophes and political violence and terrorism, changing risk profiles and potentially creating gaps in risk strategies
• Technologies being considered are new to many project sponsors, who have limited experience in their design, construction or operations
• Prototypical technologies can create unknowns for insurance markets, making it more challenging to align the affordability and availability of insurance with commercial goals
• Businesses are financing clean energy projects internally, and risk strategies need to protect business’ balance sheets

Some new energy risks remain difficult to insure, but companies that take a proactive role in educating insurers about their risk profile often secure better terms.

To find out how to access sector-specialist insights, a tailored digital dashboard and innovative tools, contact our team.