Carrying the Standard of the New Energy Revolution

For most people, Blyth—a seaside town of under 40,000 inhabitants on the northeastern coast of England—is generally not associated with major world events. But for those familiar with the energy sector, the Northumbrian city is synonymous with two of the last century’s most important revolutions.

In 1961, Blyth was a hub for coal mining and ship building. Its port was one of the busiest in the UK, with over 6 million tonnes of coal passing through each year. Then, as fuel exports from the first industrial revolution waned, Blyth’s part in the global energy market declined—only to rise once more, almost half a century later, as the driving force behind a new energy revolution.

In 2000, Blyth saw the launch of the UK's first commercial offshore wind farm: a 2-megawatt (MW) demonstration project. Two turbines, the largest of their kind in the world at the time, were able to provide enough power for around 1,500 homes and served as a testing ground for offshore wind technology. GCube^*1, a Tokio Marine Group company, provided first-of-its-kind insurance to underwrite the pioneer project’s viability.

This year, for the first time ever, Europe's wind farms are predicted to produce more electricity than its coal-fired power plants. GCube now serves eight of the world’s 10 leading renewable energy operators and supports more than 2,000 projects in 38 countries. The blueprint laid out in Blyth and other test sites around the world has turned into the foundation for a new “green” industrial revolution.

On our journey toward net zero, 2024 was a pivotal year, potentially marking the peak of global energy-related CO2 emissions. Specialist insurance has been a quiet partner along the way, enabling new technologies and projects changing our world for the better. Momentum is growing globally. Companies across every industry are seeking to decarbonize their operations and unlock new green opportunities.

The undertaking, however, remains immense. The global effort required for decarbonization is poised to spark the greatest capital reallocation in a century: $9.2 trillion in annual average spending on physical assets. Specialist insurance has a critical role to play, but to do so, the risk transfer market must evolve, embedding stability and reducing the volatility that has so far stymied progress.

Today, too many projects are unable to proceed because of investor reticence. Innovation is restricted because businesses cannot secure the necessary insurance cover to prove their concepts. The cost of insurance can fluctuate wildly, hindering progress as carriers are unwilling or reluctant to provide the cover that would drive spades into the ground, or progress new technologies from blueprints to products that can increase sustainability.

At the core of Tokio Marine Group’s culture is the belief that insurance has the power to solve the biggest problems of each era. This belief has driven our evolution for nearly 150 years, underpinning our global growth. We are one of a handful of global insurers with the scale, international footprint, influence and expertise necessary to support clients at every stage of their transition journey.

The green industrial revolution is a key challenge of this era. For over a quarter of a century, GCube has been at the forefront of the energy transition. It has facilitated innovation, enabled investment, mitigated risks and paid claims, all in an effort to enable the sector to flourish. It carries forward the new energy revolution started in Blyth, at the vanguard of the global drive to decarbonize. More and more sectors and communities are adding their weight to the movement.

The insurance industry has both the commercial incentive and the moral imperative to do more; to enable businesses at every stage of their transition journey to take practical steps on their decarbonization journeys and implement more efficient carbon neutral practices. If we fail to grasp this opportunity, we risk our market share in this burgeoning sector, our client relationships, and our relevance to industries with which we have the potential for long-term, symbiotic, sustainable growth.