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Power Market Review 2023

A smarter way to manage resilience in a volatile world

By Robin Somerville | November 8, 2023

The 2023 Power Market Review looks at the complex risks shaping the industry and how these challenges are redefining the landscape in which power market insurers operate.
Climate|Cyber Risk Management
Climate Risk and Resilience|Ukraine war

The 2023 Power Market Review explores the theme of "A smarter way to manage resilience in a volatile world" and highlights four primary challenges facing the power market and insurers. These challenges include the Russia-Ukraine conflict's impact on energy security, global inflation affecting purchasing power and costs, the urgency of addressing climate change and energy transition, and disruptions in supply chains and technology advancements. In the report we also examine the influence of El Niño on the power market from an insurance perspective.

Part One of the report delves into these challenges, discussing geopolitical risks, recession management, vulnerabilities related to climate change, considerations for power companies, evolving cyber insurance risks, and parametric insurance in the power market. Part Two focuses on the state of the power insurance markets in 2023, including challenges faced by power underwriters, property markets, international liability, and the construction sector.

As we embark on this journey through the 2023 Power Market Review, we do so with purpose and dedication. The symbiotic relationship between the power sector and the insurance market underscores their shared interests. Threats to insurers in terms of risk also endanger power sector customers. This alignment necessitates a reconsideration of risk transfer strategies, placing insurance market challenges at the forefront of strategies for both insurers and customers.

The challenges ahead are formidable, but they present opportunities to build resilience, innovate, and navigate the path ahead. The power sector's role in shaping a sustainable future is vital, and the insurance industry is a steadfast partner in this endeavour. Together, we ensure resilience remains central to our strategies, empowering power companies to weather change, emerge stronger, and face the challenges of tomorrow.

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Title File Type File Size
Power Market Review 2023 PDF 8 MB

Featured articles from the Review

  1. 01

    Our four key challenges for 2023 revisited

    In this article we revisit some key challenges from 2022, and explore what we've seen in 2023.

  2. 02

    The polycrisis and the energy trilemma: the geopolitical risk landscape in 2023

    In this article we look at the impact of the current geopolitical risk landscape on the power sector.

  3. 03

    The life extension process: considerations for power companies

    In this article we take a look at the many challenges power plant operators face on a day-to-day basis.

  4. 04

    Application of Parametric Insurance in the Power market: a review

    In this article we take a look at how innovative parametric solutions are a valuable tool for managing and transferring risk.

  5. 05

    Still struggling for profitability: a power underwriter’s view of the market

    In this article Rokstone's Ian Green discusses key drivers in the Power market in the second half of 2023, as the loss record for Power risks continues to deteriorate.

  6. 06

    Property: lack of competitive pressures continues to drive hard market conditions

    In this article we take a look at the challenges risk managers face in the power sector due to the halting traditional property insurance market cycle.

Disclaimer

WTW offers insurance-related services through its appropriately licensed and authorised companies in each country in which WTW operates. For further authorisation and regulatory details about our WTW legal entities, operating in your country, please refer to our WTW website. It is a regulatory requirement for us to consider our local licensing requirements.

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Author

Business Development Director,
Natural Resources

Contact

Alex Forand
U.S. Head of Power and Utility Broking, Natural Resources

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