P50 Risk Solutions

P50 Risk Solutions is an insurance product intended to guarantee minimum revenue for wind farms to reduce the cost of capital and attract new investment. However, analysis using a case study project indicates that the product is not commercially viable because the reduction in financing costs does not offset the insurance premiums. Furthermore, the document concludes that even with donor support, the product would not significantly attract new institutional or bond market investors, as wind variability is viewed as a secondary risk compared to off-taker payment defaults in the Indian renewables sector.

• P50 Risk Solutions is not commercially viable on its own because the reduction in the cost of financing does not compensate for the cost of the insurance premiums across the six hypothetical scenarios analyzed.
• The product is unlikely to attract new institutional or bond market investors, even if donor capital is used to support its implementation, due to the current risk environment.
• In the Indian renewables sector, investors perceive the risk of wind variability as a second-order concern compared to the risk of off-taker payment defaults.
• The insurance product is designed to provide a minimum revenue guarantee with a 90% probability, utilizing P50 and P75 levels of generation as proposed hedge levels.

APA

Climate Policy Initiative (n.d.). P50 Risk Solutions. https://www.climatepolicyinitiative.org/wp-content/uploads/2016/12/P50-Risk-Solutions_overview.pdf

Chicago

Climate Policy Initiative. P50 Risk Solutions. n.d. https://www.climatepolicyinitiative.org/wp-content/uploads/2016/12/P50-Risk-Solutions_overview.pdf.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=P50 Risk Solutions |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2016/12/P50-Risk-Solutions_overview.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiativendp50, author = {{Climate Policy Initiative}}, title = {{P50 Risk Solutions}}, institution = {Climate Policy Initiative}, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2016/12/P50-Risk-Solutions_overview.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }