Battery Energy Storage Systems (BESS) Insurance
Battery storage is changing the way electricity is managed across the UK, allowing energy to be stored when supply is high and released when it is needed.
However, the technology behind a Battery Energy Storage System (BESS) creates a distinctive combination of electrical, operational and fire-related risks.
Large concentrations of battery cells, sophisticated control systems, high-voltage electrical equipment and the potential for thermal events all need to be considered when arranging insurance.
Factors including battery chemistry, system design, fire protection, separation distances and operating procedures can influence the risk profile of a facility.
At Network Alliance Brokers, we work with BESS developers, owners, investors and operators to arrange specialist insurance based on the characteristics of the individual project.
Whether you’re developing a standalone battery storage facility, integrating BESS with a solar or renewable energy project, or managing an operational site, our team can help you explore suitable insurance solutions.
Understanding BESS Insurance
Insuring battery storage requires insurers to consider much more than the value of the physical equipment. The battery technology being used, manufacturer, capacity, site configuration, cooling systems, fire detection and suppression measures, and ongoing monitoring can all play a role in determining the nature of the risk.
The requirements can also change significantly as a project progresses through construction, testing and commissioning into commercial operation.
By working with a broker that understands these considerations, BESS businesses can arrange an insurance programme that reflects both the technology and the commercial realities of the project.
Who We Work With
- BESS Developers
- Asset Owners and Operators
- Renewable Energy Investors
- Independent Power Producers
- EPC Contractors
- Asset Managers
- Operations & Maintenance Providers
- Standalone and Co-located BESS Projects
Key Risks Facing Battery Energy Storage Systems
Thermal Runaway & Fire
Damage, manufacturing defects, electrical faults or abnormal operating conditions can cause individual battery cells to overheat. In certain circumstances, this can lead to thermal runaway, with heat potentially propagating to neighbouring cells or battery modules.
Facility design, battery chemistry, monitoring, separation and fire protection measures are therefore important considerations when assessing BESS risk.
Battery & Cell Failure
Individual cells, modules and battery racks can suffer faults or deterioration that affect the performance of the wider system. Depending on the nature of the failure, specialist investigation, repair or replacement may be required.
Understanding equipment warranties, maintenance arrangements and responsibilities between manufacturers, contractors and operators can be particularly important.
Electrical Systems
A BESS facility depends on more than its batteries. Inverters, transformers, switchgear, cabling and power conversion systems are essential to transferring electricity between the battery system and the grid.
Electrical faults or equipment breakdown can prevent a facility from charging or discharging even where the battery units themselves remain operational.
Cooling & Temperature
Battery performance and safety rely on maintaining appropriate operating temperatures. Failure of cooling, ventilation or thermal management systems can affect battery performance and, in more serious circumstances, increase the potential for overheating.
Monitoring systems and preventative maintenance can play an important role in managing this exposure.
Testing & Commissioning
The period before a BESS facility becomes fully operational introduces a different set of risks. Testing battery systems, energising electrical equipment and commissioning the facility can expose weaknesses that may not have been apparent during construction.
Insurance arrangements should therefore consider how the project moves from installation and testing into commercial operation.
Loss of Revenue
A significant incident does not only create the cost of repairing damaged equipment. If a BESS facility cannot charge, store or discharge electricity, the resulting downtime may also have a financial impact.
Appropriate Business Interruption or Delay in Start Up cover can therefore be an important part of the wider insurance programme, depending on the stage and commercial structure of the project.
Your BESS Insurance Questions Answered
What information is needed to arrange BESS Insurance?
Insurers may require detailed information about the battery manufacturer and chemistry, storage capacity, system design, site layout, fire protection, cooling systems, monitoring arrangements and maintenance procedures. Details of the project’s construction and operational contracts may also be required.
Can you insure a BESS facility located alongside a solar farm?
Yes. Battery storage is increasingly co-located with solar and other renewable energy generation. The insurance programme can be considered in the context of the wider site, taking into account the relationship between the generation and storage assets. Click here to find out more about our Solar Farm Insurance.
Can BESS Insurance cover a project before it becomes operational?
Yes. Insurance can be arranged during the construction, installation, testing and commissioning phases, with operational insurance considered as the facility moves into commercial use. The appropriate structure will depend on the individual project and contractual arrangements.
Why Choose Network Alliance Brokers?
Battery storage is a rapidly developing area of the energy market, and no two projects have exactly the same risk profile.
At Network Alliance Brokers, we take the time to understand the technology behind your facility, how the site has been designed and the contractual and operational arrangements surrounding the project.
By presenting insurers with a detailed understanding of the risk, we can help you explore appropriate insurance solutions and provide ongoing support as your BESS project develops.
Protect Your Battery Storage Investment – Contact the Team
From standalone battery storage facilities to BESS integrated with renewable energy generation, Network Alliance Brokers can help arrange insurance suited to the technology, operation and individual characteristics of your project.
Contact our team today to discuss your Battery Energy Storage Systems Insurance requirements and find out how we can support your project.
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