NU Online News Service, Oct. 25, 2:46 p.m.EDT

Renewable energy will be a driver for growth in insurancepremium, at least in Germany where there is firm commitment to thegrowth of the industry, according to Munich Re.

The Munich, Germany-based insurer issued a report saying thatpremium growth is expected to rise substantially over the next 10years, and also pointed to the growth in renewable energy as anengine for economic growth for the nation's economy.

Munich Re said that in 2009, premium income from the insuranceof renewable energy facilities totaled approximately EUR186 million(U.S. $260 million at the current exchange rate) in Germany. For2020, Munich Re said it expects premium volume to reach aroundEUR440 million ($615 million), an increase of 137 percent,according to National Underwriter's calculations.

At the same time, business potential should rise from EUR19million ($27 million) to around EUR50 million ($70 million) owingto the construction of new facilities.

Munich Re underscored Germany's commitment to renewable energy,saying that "in line with political targets, the share of renewableenergies in power generation in Germany is expected to increasefrom a current 10 percent to 60 percent by the middle of thecentury," creating the foundation for significant growth inpremium.

At the end of 2009, there were nearly 340,000 people working inthe renewable energy sector in Germany, a figure that has more thandoubled within a period of six years, according to Munich Re.

The industry's profit totaled EUR36 billion ($50 billion) inGermany for 2009, compared with EUR18 billion ($25 billion) for2005.

Munich Re declared that "renewable energies are therefore agrowth area in a generally stagnating German insurance sector, withwind power, photovoltaic and biomass playing a central role."

"We are excellently equipped to support the structuraltransformation of the energy supply sector by offering customizedrisk transfer products," said Ludger Arnoldussen, member of MunichRe's board of management, in a statement. Our spectrum ranges fromtraditional coverage for industrial facilities to complexsolutions, such as performance guarantee covers enabling capitalproviders to reduce their investment risks. Over the next few yearswe will continue to expand this product range."

The company said a recent example is the performance guaranteeinsurance concluded this month to cover so-called concentratorphotovoltaic modules manufactured by the U.S. company SolFocus.Similar performance guarantee products are being planned for windpower and solar thermal systems, Munich Re noted.