More solar, Nat Cat and aggregation risk - Our U.S. market predictions for 2026

It has undoubtedly been a turbulent twelve months for the U.S. renewables market. However, contrary to the many headlines surrounding policy changes and their ripple effect throughout the sector, we are proud to say that both TMGX and the clients we support have demonstrated an admirable capacity to weather these challenges.

In 2025, roadblocks faced by wind energy developers have led to consolidation in the sector, leaving the market dominated by larger, financially strong companies that are still able to plan and build new projects.

At the same time, U.S. tariffs have had a significant impact on prices of solar modules and other key equipment manufactured in Asia, creating price volatility that has had knock-on effects for loss adjusting claims.

Looking forward, we expect continued investment and momentum in the U.S. renewable energy space to continue. 90% of projects currently awaiting grid connection are renewable. Factors like increased ’24/7’ power demand from data centres and adoption of EVs continue to drive load growth to unprecedented levels. This provides us with optimism that, despite market uncertainty – in particular the phasing out of tax credits - the economic fundamentals of renewables development are still compelling.

In this piece, we look at some of the key trends that we expect to see in 2026. 

5 predictions for the U.S. renewables market in 2026

#1 Solar energy will dominate new installed capacity

As mentioned above, high costs, logistical hurdles and planning restrictions have all contributed to a challenging period for the wind sector. By contrast, we expect that development in solar - which currently has the lowest levelized cost of energy (LCOE) of any other energy source in the U.S. - will continue to flourish. 

The increased deployment of co-located (and standalone) Battery Energy Storage Systems (BESS) has galvanized the solar sector, enhancing profitability and making this asset class more stable and attractive. In a market where ‘24/7 Power’ is high on the agenda, co-locating BESS and solar is giving operators the ability to ‘load shift’ – enhancing the value of their projects to the grid and to increasingly demanding offtakers such as data centers.

Accelerated deadlines brought by the termination of tax credits mean that some PV construction projects will be in a race against the clock next year. However, the U.S. market is no stranger to ‘boom and bust’ construction cycles and we remain confident in the ability of the sector to deliver high quality projects.

#2 Wildfire and Nat Cat will drive insurance pricing

The U.S. insurance market is currently under-pricing its single biggest acute exposure: wildfire. In general, both clients and the insurance market are not taking this risk seriously enough. A major, market changing wildfire event could be possible, and without a broader and more serious adoption of preventative measures, such an event would fundamentally shift appetite for renewables development, particularly in exposed Western regions.

Additionally, the market has developed a better understanding of Severe Convective Storm (SCS) risk, mostly as a result of experiencing, and learning from, significant claims and losses. Insureds also have more data than ever, helping them (and us) anticipate and prepare for potential damage and business impact.

For instance, data proving the effectiveness of stowing solar panels during hail events is now translating into demonstrable loss reduction, helping us to underwrite specific risks with greater confidence. In a similar vein, the market is working to improve its understanding of wildfire and the specific risk mitigation techniques that are instrumental in reducing large-scale losses. 

#3 There will be more demand for new specialist insurance products

TMGX continues to successfully navigate a highly competitive insurance market, where new entrants are increasingly common. While confidence in the sector is encouraging, we recognise that we need to be in lockstep with our clients when it comes to providing products that meet their evolving needs. 

Our insureds’ technology is constantly evolving. Solar panels are becoming more complex, turbines are growing in size every year and BESS is increasing in capacity. We aim to support our clients as they continue to innovate and improve the sector, and part of this means ensuring that newer, larger, and more complex assets are protected from potential risks. Similarly, as the market keeps maturing and growing, we foresee a significant increase in client demand and traction for our new tax related solutions, as well as our hydrogen and carbon capture products.

#4 Aggregation risk will continue increasing

The concentration of exposure – or aggregation risk – will increase as we see installed capacity grow in California, Arizona, and Texas. New projects commonly share grid connection infrastructure, leading to a higher exposure to contingent business interruption. Additionally, a single weather event can have a significant impact on multiple projects in the same region.

Both scenarios mean that aggregation should be at the forefront of many markets. This is why TMGX focuses so heavily on working with clients to support their long-term plans, so that we can be sure we have capacity available for their existing projects as well as future pipeline. 

Our proactive approach helps clients to manage potential disruptions, maintain operational continuity, and make informed decisions about growth and investment in regions with high infrastructure concentration.

#5 There will be increased demand for repowering wind projects

Repowering of North America’s wind fleet is set to accelerate rapidly over the next few years as early projects - many built in the 2000s - approach the end of their operational lives. Replacing outdated turbines with modern, higher capacity models has become an economically attractive way to boost generation while extending a project’s life. Technological advancements, particularly larger rotors and taller towers, can increase energy yields by up to 300%. Repowering also leverages existing infrastructure, reducing costs, permitting hurdles, and the environmental impacts related to new greenfield developments. 

With growing constraints on land availability and lengthy interconnection queues slowing new project buildouts, repowering offers a faster, lower-risk path to enhance renewable output and improve portfolio performance. Therefore, we expect wind project repowering to be a major theme throughout 2026.

TMGX has worked closely with its clients on many repowering projects across North America in 2025, leveraging our deep sector expertise and passion for crafting bespoke policy wording to tailor coverage precisely to each project’s unique requirements.