Geothermal Market Based Insurance Schemes

Abstract

This report summarizes the experiences with risk mitigation for deep geothermal projects in Germany. Both technical drilling and exploration risks are addressed. To overcome the main obstacle developing geothermal projects, the exploration risk, private insurance companies and insurance brokers entered the market. The paper reports on insurance solutions in the private market sector. Basic terms and conditions are introduced and their further development with experience in a growing competitive market is described.

In the framework of the national renewable energy incentive program, the German federal risk mitigation program was started in 2008 and will be available on the German geothermal market in the first months of 2009. The author’s practical experiences from different insurance negotiations give some insight into the current use of those insurance solutions.