The Energy Storage Report 2024

Now available to download, covering deployments, technology, policy and finance in the energy storage market

Exclusions for sprinkler systems could start making their way into BESS insurance policies


The second high-profile battery storage failure due to a faulty sprinkler system could mark the beginnings of exclusions from insurance policies if certain providers develop a negative track record, a source said.

Sprinkler systems being activated when they shouldn’t have been responsible for battery failures at two major battery storage projects in California recently: Terra-Gen’s Valley Center and Vistra’s Moss Landing Energy Storage Facility, the latter the largest project in the world which was taken out of service for months as a result.

This article requires Premium SubscriptionBasic (FREE) Subscription

Enjoy 12 months of exclusive analysis

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Annual digital subscription to the PV Tech Power journal
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

While it’s still early days, a source working in the battery storage insurance sector said that these kind of incidents are likely to come up more and more as deployments grow, and that insurance policies could start to take account of them in future.

“If a certain manufacturer or EPC (engineering, procurement and construction) contractor has developed a negative track record with any part of their equipment – in this case sprinkler systems but we could just easily be talking about blades on wind turbines or inverters at a solar facility – then those will start finding their way into exclusions in insurance policies,” they said.

“You have to disclose all your equipment and who your EPC is, and if someone develops a bad enough track record the insurer will say I don’t think I want to insure this policy. And if I do, I’m putting this specific exclusion in. But those aren’t standard and a client will want to avoid those situations if they can.”

“So I would say that’s not the position at the moment, it’s so far so good, but watch this space. We’re very much at the embryonic stage of mass scale deployment and as more and more projects are deployed, just as with wind and solar, these things will start to crop up.”

As wrote recently, some in the sector say that battery insurance costs are generally falling as insurers better understand the risks involved.’ publisher Solar Media will host the 5th Energy Storage Summit USA next week on 28-29 March 2023 in Austin, Texas. Featuring a packed programme of panels, presentations and fireside chats from industry leaders focusing on accelerating the market for energy storage across the country. For more information, go to the website.

22 October 2024
New York, USA
Returning for its 11th edition, Solar and Storage Finance USA Summit remains the annual event where decision-makers at the forefront of solar and storage projects across the United States and capital converge. Featuring the most active solar and storage transactors, join us for a packed two-days of deal-making, learning and networking.
18 March 2025
Austin, Texas
The Energy Storage Summit USA is the only place where you are guaranteed to meet all the most important investors, developers, IPPs, RTOs and ISOs, policymakers, utilities, energy buyers, service providers, consultancies and technology providers in one room, to ensure that your deals get done as efficiently as possible. Book your ticket today to join us in 2025!

Read Next

June 21, 2024
Rankings by EY of the most attractive markets for renewable energy investment include battery storage, with US, China and UK as frontrunners.
June 20, 2024
Recurrent Energy has closed US$513 million financing on a battery storage project in Arizona, US, which has a 20-year utility tolling agreement in place.
June 20, 2024
The US energy storage industry saw its highest-ever first-quarter deployment figures in 2024, with 1,265MW/3,152MWh of additions.
June 19, 2024
TWAICE has partnered with NARDAC to bolster insurance coverage for battery energy storage system (BESS) asset owners, investors and lenders.
June 18, 2024
Jupiter Power has unveiled plans to construct a 700MW standalone battery energy storage system (BESS) facility at the site of a former oil depot previously owned by ExxonMobil in Everett, Massachusetts.

Most Popular

Email Newsletter