75% of Southeast Asia’s Future Renewable Energy’s Generation Capacity Under Threat – But USD 82 Billion in Losses Can Be Circumvented

SINGAPORE, 10 June 2026 – Targeted investment in climate resilience could help ASEAN members mitigate up to USD 82 billion in potential losses to renewable energy infrastructure, according to a new energy resilience report by Zurich Insurance.

The report finds that of the 1,380 existing and future renewable energy generation sites across ASEAN (excluding Timor Leste), 75% of the total capacity is projected to face severe climate risk exposure by 2030, putting approximately USD 165 billion in renewable energy assets at risk across the region.

Zurich’s analysis shows that resilience must be built into the region’s clean energy growth from the outset. An upfront investment of approximately USD 13 billion in resilience measures would reduce the forecast financial exposure from climate events by 40% to 50%, delivering an estimated 6.5x return on investment.

The findings highlight a major opportunity for governments, investors, developers and insurers to protect the region’s clean energy build-out as climate hazards intensify.

Southeast Asia is entering the largest clean energy build-out in its history. Countries in the region are targeting renewable energy to account for 45% of installed power capacity by 2030, up from 33% today, as part of the ASEAN energy plan. Achieving these goals will require clean energy investment to reach around USD 190 billion by 2035 – roughly five times current levels.

The financial case for early action is clear: By embedding resilience into planning, financing, design and construction, ASEAN can reduce future losses, improve insurability and bankability, and strengthen the long-term reliability of its clean energy transition.

Mark Fletcher, Head of Zurich Resilience Solutions, Asia Pacific, Zurich Insurance said: “Southeast Asia has a clear opportunity to protect the value of its clean energy transition before losses materialise. Our analysis shows that targeted resilience investment can significantly reduce future climate-related losses, while also improving the insurability, bankability and long-term performance of renewable energy assets. Embedding climate resilience into planning, design, procurement, financing and operations from the start is critical to ensuring the region’s renewable energy build-out delivers reliable power and durable long-term returns.”

The report sets out five practical actions to help governments, investors, developers and operators move from risk identification to resilience investment:

• Make climate risk screening mandatory at planning and permitting: Forward-looking climate screening should become a standard requirement for site selection, project approval and permitting. Historical baselines are no longer sufficient for assets expected to operate into the 2050s and beyond. Early screening also allows resilience measures to be introduced when costs are lower and design flexibility is greatest.
• Stress-test the highest-risk assets first: With 75% of assessed renewable energy capacity projected to sit in Categories 4 and 5 by 2030, Zurich recommends prioritising the most exposed projects for multi-hazard stress-testing. This can help quantify potential losses, identify the dominant risk drivers and create a clear investment roadmap for resilience action.
• Build hazard-specific resilience into procurement: Long-term resilience is often determined before an asset is built. Zurich recommends embedding requirements such as wind loading, hail resistance, flood elevation, drainage, fire protection, corrosion resistance and redundancy into design and procurement standards, rather than treating them as optional upgrades.
• Treat system resilience as part of asset resilience: Renewable energy assets depend on the wider network around them, including grid infrastructure, interconnection, access roads, water systems, communications and emergency response. Zurich recommends extending resilience planning beyond the project boundary to support faster recovery after severe climate events.
• Use resilience quantification to unlock capital: Resilience can be translated into financial terms. By showing how upfront design investment can reduce value at risk, improve insurability and strengthen bankability, asset owners and developers can create a stronger basis for engagement with lenders, insurers and investors.

The recommendations are grounded in Zurich’s analysis of the scale, concentration and nature of climate exposure across the region’s renewable energy pipeline.

The scale of exposure underlines the need for action
Zurich’s analysis shows that while resilience investment can materially reduce future losses, the scale of exposure across Southeast Asia’s renewable energy pipeline is significant and growing.

• USD 165 billion in renewable assets is exposed: Zurich’s analysis estimates that approximately USD 165 billion in renewable energy infrastructure across Southeast Asia could be at risk without effective resilience measures.
• Exposure is widespread and intensifying: By 2030, 75% of the region’s pipeline generation capacity, approximately 181,000 MW, enough to power 180 million households for a year, to is projected to sit in the top two risk bands, Category 4 and 5.
• Four hazards pose critical risks: Wind, flooding, hail and tornadoes rank as “very high” risk hazards across the report, each linked directly to material loss mechanisms, including civil works damage, substation failure, module degradation and compromised turbine structures.
• Solar carries the most pronounced near-term exposure: With 731 sites generating 117,884 MW, solar represents the largest technology in Zurich’s data set. By 2030, 80% of solar sites are projected to fall into Category 4 and 5 risk. 

Amar Rahman, Global Head Sustainability & Climate Solutions, Zurich Insurance added: “The science is clear that physical climate risks are not a distant consideration for renewable energy infrastructure. These are long-life assets that will be exposed to a range of extreme weather events, from water stress, heat and flooding to hail and extreme wind. Forward-looking climate data gives asset owners and investors a clearer view of dominant risks, potential losses and where resilience investment can have the greatest impact on revenues.”

Resilience must be built in from the start

Zurich’s analysis shows that resilience measures are most effective when embedded during the design and construction phase, when engineering flexibility is greatest and costs are lower. Beyond reducing physical damage, resilient assets are also easier to insure, easier to finance and better positioned to deliver reliable long-term performance.

Zurich modelled a project scenario to demonstrate the value of early resilience action. Without resilience measures in place, a severe hail event could cause damage estimated at approximately 90%, resulting in an estimated maximum loss (EML) of approximately USD 178.5 million in property damage, with significant additional business interruption exposure and a recovery period of up to 21 months. The addition of a single-axis tracker system with an automated hail stow function could materially reduce that exposure, improving both insurability and bankability. This level of resilience can directly influence insurer appetite, lender confidence and the long-term performance assumptions underpinning renewable energy projects.

Tulsi Naidu, Chief Executive Officer, Asia Pacific, Zurich Insurance added: “Resilience is most effective when it is engineered into a project from the start, rather than retrofitted after a loss has occurred. For renewable energy developers, this is increasingly becoming a bankability and insurability issue. Projects that can demonstrate how risk has been assessed, quantified and reduced will be better positioned to attract capital, secure insurance capacity and deliver reliable long-term performance. 

As ASEAN accelerates its clean energy build-out, resilience must become a core part of how renewable energy projects are planned, financed, insured and operated. The quality of project development will matter as much as the quantity of capacity installed. Embedding resilience from the start will be critical to protecting asset values, maintaining insurability and ensuring the region’s energy transition delivers reliable power and durable long-term returns.

Read further insights from Zurich’s Energy Resilience report here.
 

For further information, please contact:

Ben Evetts
Head of Communications & Marketing, Zurich APAC
ben.evetts@zurich.com.sg