What if the sun doesn’t shine?
A new insurance product hopes to answer that burning question – one bankers continually ask when approached to finance solar projects.
San Francisco-based Walsh Carter & Associates Insurance Services spent more than three years creating SolarShield in response to growing concerns among financers investing in commercial solar projects. The company bills SolarShield as "the first true performance warranty that will guarantee the minimum revenue generated by solar photovoltaic systems in the event of production shortfalls."
“Unlike the others, claims do not require proof of negligence or defect on the part of the system developer,” said David Saisi, vice president of business development in Walsh Carter’s solar practice. “Ours is a simple policy that acts as a backstop for financial institutions that are concerned about system performance. Our policy will make up any lost revenue due to system underperformance, and it names the bank or financial backer as the loss payee for any claims.”
SolarShield expands upon Walsh Carter’s existing solar product Total SPF Solar Protection Package, which offers comprehensive coverage for fiscal risks associated with various phases of commercial solar energy projects, including liability or property damage.
The Walsh Carter products also offer three-year policies, whereas other companies tend to focus on one-year policies.
The warranty directly guarantees the backing financial entity restitution and debt service payments in the event of any production shortfall. Examples of covered losses include extended inclement weather, premature deterioration of system components, poor workmanship causing reduced output, and any temporary sky obstruction such as smoke from a forest fire or volcanic action. Items not covered include regulatory actions requiring the equipment to be shut down pending safety checks, and/or resolution of permitting or interconnect issues. The SolarShield program covers up to 85 percent of the rated output, with a 14-day time element deductible.
“Solar insurance is a very specialized field that requires a depth of knowledge about the many fiscal issues associated," said Luigi Resta, CEO of Scatec Solar North America.
An infographic outlining Walsh Carter's solar products is offered below.