male contractor inspecting solar panels

Spotlight on renewable energy in 2021

Tom Baker, Markel's International Head of Renewable Energy, provides his 2021 outlook for the booming renewable energy industry.


Despite a tumultuous year in 2020, combating climate change has remained on the top of the agenda for many policymakers around the world. Globally, many countries have already pledged their carbon-neutral targets by 2050 as part of the Paris Climate Agreement to reduce global warming.

As global economies emerge from pandemic-induced recessions, green stimulus packages from various governments are expected to accelerate the world’s growth and appetite for clean, renewable energy.

In response to the anticipated green recovery, more companies have been steadily incorporating environmental, social, and governance (ESG) factors into their corporate governance frameworks.

In 2020, Markel’s International division appointed Thomas Baker (Tom) as their International Head of Renewable Energy. Baker, who is based in Singapore, recently shared his experience in the renewable energy market and the outlook for this booming industry in 2021.

Q: With over 15 years of experience in the renewable energy sector, what is your background and how has it shaped your understanding of the renewables market?

Tom: My experience in the renewable energy sector started with Windsor Partners (now part of RK Harrison) where I specialized in placements for European clients in the London markets’ first dedicated renewable energy broking team in London.

In 2010, I joined GCube, a specialist and dedicated renewable energy insurer, where I spent close to seven years underwriting a global renewable energy portfolio of projects with a focus on onshore and offshore wind and solar photovoltaic (PV).

During my time there, I developed strategic relationships with the major brokers and capital providers in London. Whilst based in London, the opportunity to work on the global renewable portfolio also allowed me to expand my knowledge of key onshore renewable energy territories, including Australia, Africa, North America, and Brazil, and the burgeoning European offshore wind market.

In 2018, I moved to Singapore to focus on the renewable energy market in Asia, leading Aon’s renewable energy growth in key Asia Pacific markets, overseeing the large growth markets of Japan, Taiwan, and Vietnam, with additional exposure to the China offshore wind market and other Southeast Asian economies.

Last year, I joined Markel as international head of renewable energy, becoming their first global head based in Asia. At Markel, I manage and grow our international renewable energy portfolio, and lead the development of new products to support the growth of the industry.

Q: What are the developments in recent years that have influenced the growth of renewables globally?

Tom: In 2020, as the pandemic restrictions led to a sap in global energy demand, we saw a drop in energy supply, mainly from fossil fuels. In contrast, the renewable markets have shown resilience to the COVID-19 pandemic, especially for renewables used for generating electricity in regions such as Europe and Asia.

Renewables has become the dominant electricity source in the European Union’s generation for the first time ever last year at 38%, just surpassing fossil fuels at 37%, based on grid data analysis by research organizations Ember and Agora Energiewende. This is a turning point for the renewables market in Europe.

The growth trajectory for this sector is expected to continue steeply, especially since Europe needs to double its share of electricity produced from renewables in order to realize its strict goal of reducing carbon emissions by at least 55% by 2030 from 1990 levels. North America is also showing similar growth ambitions and trajectories.

Similarly, in Asia more countries are embracing renewables for a more sustainable future. China, Japan, and South Korea–three Asia economic powerhouses that emitted one third of all global carbon emissions in 2018–have pledged to achieve carbon neutrality by 2050. Driven by China, more renewables projects are expected to come online this year, having been temporary slowed down by the pandemic in 2020; and we can look forward to more capacity additions in the region, particularly for wind and solar.

Q: What is Markel’s strategy and goals for its renewable energy portfolio globally?

Tom: Markel has been supporting the renewable energy industry in different forms for over ten years. Currently, the renewable energy insurance market is largely focused on Europe, predominately London, with the top renewables markets mostly in Europe and the US. However, Asia has been rising steadily, too, with China, India, and Japan as the region’s top renewables markets, according to the 2020 Renewable Energy Country Attractiveness Index by EY. This presents us with strong opportunities in both London and Asia.

The newly created renewable energy department last year reaffirmed Markel’s aim of becoming a market leader by developing a variety of innovative renewable energy products to support the industry internationally and to support the growth of the industry and insure them from the unknown.

As the global energy industry grows in favor of renewable energy, our short-term goal will be to develop new renewables products and diversify our product mix which will sit alongside the traditional energy products that are well established in the insurance industry. With teams across the world, this will allow us to empower our clients with the confidence and freedom to operate at their best through our local specialists.

Q: Looking ahead, what is the market outlook and significance of the renewable energy industry?

Tom: With the integration of ESG into corporate governance, the drive for renewable energy globally is expected to continue on its rising trajectory.

Many financial institutions, driven by the adoption of sustainability in their operations, are also influenced by ESG factors in their investment and decision-making. This has led to the rise of green financing, supporting the exponential growth of renewable energy projects expected in the decade.

Investments into renewable energy projects are currently seen as one of the main economic drivers for a post-COVID-19 market recovery. A shift to clean energy can be a positive sign as it helps to drive the economy and create more jobs.

As the world pushes for energy security and seeks greener alternatives, we can expect a transition to a lower carbon energy world. According to a 2020 report by the International Energy Agency, global energy-related carbon dioxide emissions dipped in 2019 following two consecutive years of increases. In part, this was due to the growing significance of renewable energy, and at Markel, we are excited to continue supporting this essential industry as the world pushes for carbon neutrality.

TOPICS