Vertical Limit

The mountaineering film "Vertical Limit" hit cinemas in the year 2000 with mixed reviews. While it provided a passable exploration of humanity’s ambition to ‘go higher’ and challenge the implacable forces of nature, audiences were split over the sheer number of cliff-hangers.

Insurers are giving the recent performance of the offshore wind sector similarly mixed reviews.

As the industry pushes to ‘go higher’, with the deployment of larger, higher capacity turbines, there is significant concern from risk management professionals across the on- and offshore wind sector that this ambition is coming at the cost of one too many hair-raising moments.

An unprecedented number of mechanical breakdowns, component failures and serial defects are damaging the profits of manufacturers, placing pressure on the supply chain to keep up and leading to mounting project delays.

While there is currently no shortage of capacity in the market, insurers are now reconsidering the risks of underwriting larger, newer offshore wind turbines.

We must wake up to the reality of these challenges. On account of growing failure rates, coupled with ongoing supply chain challenges, participation in the offshore wind market has become a risky business, not only for insurers, but also manufacturers, developers, and supplier companies – with some now facing a material risk to their survival. With so much at stake, we must ask ourselves, have offshore wind turbines gone too big, too fast?

Our version of “Vertical Limit” attempts to answer this question by compiling our most up-to-date proprietary claims data, alongside interviews with experts from across the sector. In doing so, it puts forward key recommendations for manufacturers, developers and insurers to help them find a more sustainable path of development that doesn’t take us over the cliff edge.

Above all else, “Vertical Limit” attempts to constructively contribute to ongoing industry debate to strengthen the sector, and its players, as it scales up in the years ahead.