March 7, 2019: German insurance firm Munich Re has launched an insurance product that allows large-scale energy storage developers to guarantee their project’s long-term performance, the company announced on March 7.
Munich Re believes the insurance will make it easier for developers to obtain project financing because it caps the maximum warranty costs incurred in the repair or replacement of defective or weak battery modules.
The cover is primarily aimed at major projects, such as those delivering grid stability and peak shifting services. In a second phase, the product will be introduced onto the mobility market to insure performance of batteries in electric vehicles.
Peter Röder, member of the board of management at Munich Re, said: “The ability to insure battery performance is a key piece of the puzzle in decarbonising our energy sector.
“For the first time, battery manufacturers can insure against the risk of their products not delivering as promised.”
The coverage can optionally be expanded to protect selected investment projects directly, so that the insurance will pay even if the manufacturer that issued the warranty files for insolvency within the warranty period.
The first customer for the new insurance product is the US redox flow battery manufacturer ESS Inc.