Calamity damage to energy facilities hikes insurance cost

by Myrna Velasco May 30, 2016 (updated)

http://www.mb.com.ph/calamity-damage-to-energy-facilities-hikes-insurance-cost/

This was indicated by First Gen Corporation chairman Federico R. Lopez; while noting the clobbering climate-related events that struck their facilities in over a decade – with the worst ones just occurring in the last five years.

“Over the last 15 years, our geothermal energy facilities incurred damage from extreme weather events totaling over R9.0 billion,” Lopez said.

He reiterated that “more than 85-percent of this number was incurred only in the last five years” – the recorded most extreme of events so far had been the Yolanda (international name: Haiyan) disaster of 2013.

Lopez qualified that as a result, “insurance premiums at EDC (Energy Development Corporation) climbed from R243 million in 2011 to R682 million in 2015.” EDC is the subsidiary of First Gen which operates its geothermal assets.

He stressed “insurers are now beginning to see extreme weather events as everyday risk.”

In fact, the Lopez group is not just expanding its power generation business at this point, but has also been turning this into a crusade of patronizing only ‘cleaner energy sources’ so they stop becoming environment offenders and disaster-triggers.

“What has become clear to us is that weather patterns are no longer what they used to be and we need to quickly adapt to a changed planet,” Lopez averred.

He added that this is the reason why EDC “spent substantially on geohazard mapping, landslide mitigation and typhoon-proofing of our facilities last year.”

Turning their energy facilities resistant to extreme weather swings include “working with suppliers on new designs for our structures and vital sections of our power plants, built now to withstand the 300 kph (kilometers per hour) winds of the future,” Lopez stressed.

The company chairman said they also “employed a team of more than a dozen dedicated and well-equipped disaster response professionals who are currently dispersed at various plants.”

He added the team has been “constantly training our internal corps of volunteers, as well as teaching local communities and government units to be force multipliers and first-responders.”