KARACHI: Experts highlighted the critical importance of insurance for the sustainable development of multiple energy resources, including power, oil, and gas, aimed at promoting investment opportunities, innovations, and efficiencies within the sector in Pakistan.
Speaking at the Energy Summit here in Karachi, Chairman Lockton MENA Ata Khatib said the energy sector is transforming globally through innovation and technology to address the requirements of economies, keeping in view the overriding challenge of global warming and climate change.
He said the insurance of the energy sector, including power plants and refineries, is indispensable in compliance with international standards, giving confidence to foreign investors in the Pakistani market on a long-term basis.
Insurance coverage enhances investor confidence by offering assurance against potential risks and uncertainties. Lenders and investors often require insurance as a prerequisite for financing renewable energy projects, recognizing its role in safeguarding their interests and ensuring project bankability, he added.
Dr Jason Shirely, General Manager of ECP and Chemical Professionals, pointed out that Pakistan is highly vulnerable to the effects of climate change, resulting in losses to power sector infrastructure. Therefore, insurance plays a pivotal role in mitigating these risks and providing the financial security necessary for sustainable energy projects.
Climate change poses significant challenges to the sustainable energy sector, with extreme weather events becoming more frequent and severe. Insurance solutions, including catastrophe risk insurance and climate risk assessments, help energy companies build resilience, adapt to changing environmental conditions, and mitigate the impacts of climate-related risks on their operations, he added.
Zainab Khatib, Vice President of Lockton MENA, said the insurance stimulates innovation and promotes the adoption of new technologies in the sustainable energy sector. Insurers collaborate with energy companies to develop customised risk management and cybersecurity solutions tailored to the unique challenges of renewable energy projects, driving efficiency, sustainability, and growth.
Insurance enables renewable energy developers to manage and transfer risks associated with project development, construction, and operation. By providing coverage for property damage, business interruption, and liability claims, insurance helps mitigate financial losses and protect investments, ensuring project viability and continuity, she added.
The Energy Summit brought together key stakeholders, industry experts, policymakers, and investors to address critical challenges and explore opportunities for sustainable development. The event aims to foster dialogue, collaboration, and innovation in tackling the multifaceted issues plaguing the country energy landscape.
The summit featured a diverse range of sessions, panel discussions, and networking opportunities focused on driving positive change and shaping the future of energy in Pakistan.
Commenting on the significance of the Energy Summit, CEO Fidelity Insurance Brokers Khurram Ali Khan stated, The Energy Summit represented a pivotal moment for Pakistan's energy sector, providing a unique platform for stakeholders to come together, share expertise, and chart a course toward a more sustainable and resilient energy future. By fostering dialogue and collaboration, we aim to drive meaningful change and unlock the immense potential of Pakistan's energy sector.
Copyright Business Recorder, 2024
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