Zurich and Aon have launched comprehensive coverage for hydrogen energy projects with capital expenditure up to $US250 million ($375 million).

Zurich is lead insurer and Aon the exclusive broker, and the facility has already been oversubscribed by participating insurers.

“Clean hydrogen has immense potential as an eco-friendly alternative to fossil fuels and we strongly believe it can play a critical role in the energy transition,” Zurich CEO commercial insurance Sierra Signorelli said. “We are proud to bring this groundbreaking initiative to the market together with Aon.”

The pair have spent two years researching hydrogen projects and say their facility provides a suite of solutions across the entire hydrogen production value chain.

It covers blue hydrogen, which is derived from natural gas and uses carbon capture technology, and green hydrogen, which is produced by splitting water into hydrogen and oxygen.

Aon CEO of commercial risk Joseph Peiser says developers and capital providers have found it challenging to secure adequate coverage for the various phases of global hydrogen projects.

“This new solution caters to their unique needs, providing comprehensive coverage addressing the complex risks associated with hydrogen projects across the entire project life cycle.”

The multiline clean energy insurance facility offers coverage through a single integrated policy encompassing construction, delay in start-up, operational cover, business interruption, marine cargo limits, and third-party liability. It also covers carbon capture and storage technologies.

Hydrogen can fuel vehicles and has potential to replace natural gas to heat buildings, and it is already used to refine petrol, manufacture steel, treat metals and produce chemicals.

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