A leading risk management expert has said the technology and the progress in sustainability is creating a new challenge as current standards struggle to keep pace with change.
Andy Miller loss control technical manager at Allianz Insurance, told Emerging Risks that the insurers was working with its commercial clients on ways in which they can enhance sustainability but the complexity and speed of change comes with new risks.
“We live in a rapidly changing world,” he explained. “Sustainability and the move to net zero has seen many businesses looking to do the right thing. They are examining ways to access alternative power and energy systems, and looking at how they can better conserve other resources such as water.”
Miller said businesses were looking to renovate premises to reduce their environmental impact and to enhance their resilience.
He added the business was working with clients to introduce electric vehicles charging capabilities and also solar panels with the focus in ensuring they are installed safely.
However he added: “The concern is that as progress continues, as does the development of the technology, standards take time to catch up. Our challenge is understanding the changes and the progress before it happens so we are able to understand the next risk management requirements our clients will face and ensure we can change the risk management guidance accordingly.”
Miller said a current concern is around the growing use of battery storage facilities.
“They are used to store power, from solar panels for instance while other firms use the facilities to store excess energy for resale. It comes with risk. You can get significant energy release, toxic gases and significant fire risk.
“However, battery technology continues to develop. We are seeing the development of new and less volatile batteries such as lithium iron phosphate which are improving the risk profile. The tech is starting to get safer.”
Miller continued: “The use of solar panels continues to grow in popularity. What we have seen is the risks of high winds on solar panels which are secured by ballast rather than fixed to the ground. Recent high winds cause damage to those ballast secured panels and it is a risk we are working with our clients to address.”
He said that commercial tenants were coming under pressure from clients around the sustainability of their premises and this in turn saw pressure being placed upon building owners to ensure their properties are both sustainable and resilient.
“If property owners do not respond it may well see the value of their assets fall as tenets will be reluctant to occupy building which impact their efforts around sustainability,” he added.
Miller added that while new construction methods are looking to use more sustainable methods such as timber, the moves come with risk.
“While timber and laminated timber are more sustainable, they come with additional fire risk,” he explained. “While we want to see timber used, we are keen to see a hybrid system which also uses non-combustible materials, which also creates additional resilience to fire risks.”