Corporates: Due diligence for a renewable energy project

How can XDI help?

• Minimise risks and impacts on your company’s finances, operations and strategic objectives
• Inform operational risk management plans with financial metrics informed by insurability
• Conduct in-depth analysis of potential damages and failures for multiple assets
• Assess on-site and surrounding critical infrastructure risks using XDI’s unique mesh analysis
• Explore adaptation options to inform capex and resilience strategies

In this use case XDI carried out point-based analysis of the entire site and 78 individual turbines.
In addition, XDI used a mesh-based approach to identify dependencies on surrounding power infrastructure  and transport networks.

Separately, each turbine was assessed using an appropriate archetype from XDI’s library, with each asset subjected to a multi-hazard stress test at 5 year intervals until 2100.

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The analysis identified several turbines where the risk of heat-related failure was a potential risk under extreme climate conditions. 
Several turbines were also at risk from forest fire due to their proximity to vegetation.  

The ability to explore solutions via XDI’s Adapt module (a feature of their interactive risk visualisation tool, XDI Globe) allowed the team to evaluate the cost-benefit of various asset-level adaptation options including insulation of electrical components to protect them from heat, and relocation of some turbines away from fire risk areas. 

XDI Globe was also used by the project team to help key stakeholders, including power and transport infrastructure owners and operators, visualise identified risks and work collaboratively to develop adaptation options that reduced risks for all.

Table:  Failure Probability, MVAR and uninsurability

Failure probability is the annual probability of a climate hazard causing the asset to stop working with or without damage. This metric relies on the vulnerability of an archetype’s element to a particular hazard. 

In each analysed year, an asset’s overall MVAR is the potential damage costs caused by climate-related hazards to date, as a proportion of the total asset value. 

Results:

• Overall Low to Moderate Risk across asset portfolio
• Failure due to the exceedance of heat was shown to be more significant than the impacts of physical damage from other hazards
• A small number of assets were identified to be at risk of both damage and failure from forest fire
• Highest risk assets adjacent to vegetation
• Critical infrastructure interdependencies heightened operational risks
• Driving hazards: forest fire, soil movement, heat

Metrics provided to the client included:

• Maximum-to-Date Value at Risk
• Total Technical Insurance Premium
• Heat Failure Probability
• ABC Ratings

Results were provided in:

• a summary report (PDF) with ready-to-use graphs, tables and images
• a data spreadsheet (CSV)
• XDI Globe

Adaptation options and pathways developed by the client were easily exported into its presentations and reports to various stakeholders. 

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