Energy Storage

Early in site acquisition, there may be a need to purchase a long-term financial indemnity to benefit landowners, neighbours, regulators, or local authorities arising from historic covenants, brown land contamination, or newer counterparty or legal requirements.

Simultaneously, SPVs may be established in need of specially drafted Director’s Liability clauses Director and Officers (D&O) to reflect the roles of Directors and their relationships with connected parties.

We can provide: 

• Long-term financial indemnities to protect landowners, neighbours, regulators, and local authorities from historic covenants or contamination risks.
• Specialist D&O clauses for SPVs, tailored to the unique responsibilities of directors in connected-party structures.

It’s essential to cover both the construction and the first year of operation from the outset of the project, so that investors have confidence the facility is insurable on an ongoing basis. To arrange optimum cover, insurers will need to be engaged early in the process. Fire engineering issues such as spacing, racking, suppression and signalling can be agreed with insurers, thus avoiding any costly retrofit.

We can provide: 

• End-to-end construction insurance designed to secure investor confidence from day one.
• Early insurer engagement to avoid costly retrofits and align fire engineering decisions (spacing, racking, suppression, signalling) with insurer expectations.

A standard Construction Insurance policy will not cover any element being shipped from outside the country of construction, and to address this, specialist Marine Insurance is required for the transit, and any loss of revenue as a result of delay in start-up (DSU) caused by damage during, or insurable delays to, the transit. 

We can provide: 

• Specialist Marine insurance for components shipped internationally, critical as most batteries travel East to West through geopolitical and weather-exposed routes.
• Delay in Start Up (DSU) cover to protect revenue if transit issues push back commissioning.

Fire and storm damage to construction sites are common and can delay the start of revenue generation, destroying the investment case.

Once operational this risk of an interruption in income is only slightly less acute in view of the regularity of BESS fires, and the increase in storm damage across Europe.

Income Protection cover will be required on an ongoing basis and needs to recognise the evolving supply chain complications and time delays post incident.

We can provide: 

• Construction site damage cover for fire and storm events that can derail revenue timelines.
• Operational income protection that reflects real-world supply chain delays and the increasing frequency of BESS fires and severe weather across Europe.

Grid Deposit and Decommissioning Bonds are increasingly required in the UK and across Europe and can be complex given the relative infancy of the (B)ESS market and projects, being pre-revenue.

We can provide: 

• Complex bond solutions for pre-revenue projects, essential as grid operators and regulators tighten requirements across the UK and Europe.

Any access to grid infrastructure or critical dependent systems is seen as an extremely elevated risk for cyber-attack, and a failure of security by the developer/operator might lead to both liability and considerable damage to machinery and downtime. Battery management systems and optimisation create a potential professional negligence exposure to claims for lost revenue or property damage.

We can provide: 

• Cyber protection for grid connected systems vulnerable to attack, covering both liability and equipment damage.
• Professional indemnity for optimisation platforms and battery management systems that could be blamed for lost revenue or property damage.

Very few insurers worldwide specialise in (B)ESS, and it’s therefore vital to work with an insurance broker who is active in the insurance market and knows which insurers are open for business, which insurers are already over committed to one location or technology, and which insurers are seen by their peers as a suitable leader when the size of the project requires more than one insurer. 

With larger projects, it’s conceivable that the support of the majority of the insurers who are currently active in the ESS market may be required, so a carefully considered navigation of insurer relationships is essential.

With Howden, you’ll have: 

• Access to the world’s few true BESS specialists, critical because only a small number of insurers understand this sector deeply.
• Multi-insurer programme design for large projects requiring coordinated capacity across multiple markets.

Very few insurers worldwide specialise in (B)ESS, and it’s therefore vital to work with an insurance broker who is active in the insurance market and knows which insurers are open for business, which insurers are already over committed to one location or technology, and which insurers are seen by their peers as a suitable leader when the size of the project requires more than one insurer. 

With larger projects, it’s conceivable that the support of the majority of the insurers who are currently active in the ESS market may be required, so a carefully considered navigation of insurer relationships is essential.