When climate risk becomes credit risk for renewable projects

From hail corridors to tornado alleys, physical risk is becoming one of the most expensive variables in renewable energy finance. Yet many of these risks remain difficult to quantify, leaving lenders, insurers and investors to make decisions with limited loss data and imperfect risk assessment. As extreme-weather losses rise, that uncertainty is increasingly finding its way into expected credit losses, debt-service requirements and the overall cost of capital for renewable projects.