Roadmap for integrated climate risk management: Climate risk in Barbados' renewable energy sector

This roadmap is developed from work undertaken on integrated climate risk management through the “Advancing Climate Risk Insurance plus” (ACRI+) project implemented by the Deutsche Gesellschaft für International Zusammenarbeit (GIZ) GmbH and the Munich Climate Insurance Initiative (MCII). In Barbados, the ACRI+ project is working with stakeholders to improve the resilience of existing and future renewable energy generation, transmission and distribution infrastructure to climate and disaster risks. 

The roadmap focuses on opportunities for risk transfer, particularly through insurance mechanisms in the Barbados solar photovoltaic (PV) sector. Risk transfer instruments, such as insurance, are increasingly being used by governments, business and households to reduce the immediate and long-term losses associated with extreme weather events. The potentially catastrophic nature of climate risks in the Caribbean, particularly in the context of climate change, means that risk transfer is likely to play an important role in building resilience. This is enabled by the design of appropriate financial instruments, including insurance. 

Currently, there are significant barriers to scaling up risk transfer in the renewable energy sector. The roadmap identifies some of the major such barriers, and suggests actions and recommendations that could be followed to address them. It considers the roles of different actors, including the insurance industry and government, in scaling up renewable energy technologies in a manner that considers and integrates risk management principles. The roadmap makes recommendations about immediate, short, medium and long-term actions primarily related to scaling up the potential role of risk transfer in integrated climate risk management in the Barbados solar PV sector.