Risks and risk management of renewable energy projects: The case of onshore and offshore wind parks

Wind energy is among the most relevant types of renewable energy and plays a vital role in the projected European energy mix for 2020. The aim of this paper is to comprehensively present current risks and risk management solutions of renewable energy projects and to identify critical gaps in risk transfer, thereby differentiating between onshore and offshore wind parks with focus on the European market. Our study shows that apart from insurance, diversification, in particular, is one of the most important tools for risk management and it is used in various dimensions, which also results from a lack of alternative coverage. Furthermore, policy and regulatory risks appear to represent a major barrier for renewable energy investments, while at the same time, insurance coverage or alternative risk mitigation is strongly limited. This emphasizes the need for new risk transfer solutions to ensure a sustainable growth of renewable energy. (C) 2016 Elsevier Ltd. All rights reserved.