Founded in 1997, Risk Solutions International (or RSI) began in Melbourne as a specialist broker in risk transfer. The vision was to find solutions for clients where traditional brokers and their traditional business models could not. To this day, we do not offer conventional risk transfer solutions. We work in what is commonly referred to as “alternative risk transfer”. This field isn’t so much about what is protected (in terms of assets or revenues) but how it is protected. It is moving beyond concepts such as loss and indemnity and focusing on what businesses really need when the unforeseen occurs. Early on RSI found an edge in credit risk, turning risk mitigation into opportunity and enabling clients to secure finance for expansion. Key areas included credit enhancement and residual value risk transfers. One of Australia’s “Big Four” banks regularly looked to RSI to assist clients at this time, testament to RSI’s expertise in the area. The business also recognised opportunities early on in two major national macro-economic developments in the late 90’s and early in the new millennium – the privatisation of energy production and other infrastructure in Australia and the advent of weather risk transfer. These developments revealed the need for more efficient risk management and simultaneously provided tools to do so. With RSI’s assistance, generators in particular were able to find ways to protect themselves in a way that better reflected their business environment in the event of mechanical failure (or adverse weather conditions). We played a leading role in the development of forced outage cover in Australia for coal and gas-fired generators where settlements are tied to market outcomes through wholesale prices.
We set ourselves the challenge of being able to help any business understand and meet the challenges and opportunities presented by weather.
Next RSI arranged several ground-breaking weather deals in the power market with settlements based on a recognised weather index and wholesale prices. That included a long-range weather deal in 2003 for 5 years, widely regarded to be the first of its kind. Other innovative work includes developing products aimed at the challenge of intermittent wind generation, which are now being applied to solar generation. A particularly exciting development, largely brought about by Australia’s commitment to renewable energy, sees a marrying of our experience in credit enhancement and weather risk to assist wind and solar farms from new entrants obtain funding. Our work in energy and weather risk naturally evolved into work with clients from other industries affected by weather patterns. We now work across several industries, including agriculture, utilities, mining, transport and construction. Since 2008 we have had a joint venture in the energy field with CQ Partners. We have also worked collaboratively with counterparties – the capital providers – to developed long-term relationships, ultimately to our clients’ advantage. We set ourselves the challenge of being able to help any business understand and meet the challenges and opportunities presented by weather. Throughout our history, we have strived to be:
Company was formed initially as an Insurance Broker
Commenced placement of Credit Enhancement Contracts underpinning cash flows and asset values.
Initial cover for electricity price volatility in Victoria
The first forced outage contract for a generator arranged
Second forced outage contract arranged
Commenced arranging weather contracts
First multi-year weather contract arranged
Commenced placement of contracts as a derivative as Corporate Authorised Corporate Representative
Commenced the Joint Venture with CQ Partners.
Development and arranging of wind firming contracts for generators, developers and financiers
Further development of wind firming based on actual production
Together with CQ Partners awarded the Best Weather Broker in Australia by Environmental Finance
Commencement of development of large scale bespoke weather solutions for the agriculture sector
Development of focus on weather as part of climate change
Celebration of 20 years of Risk Solutions International and of our fifth year in a row receiving together with CQ Partners the Best Weather Broker in Australia Award
Placement of the first Proxy Revenue Swap for wind and solar.
Risk Solutions International in conjunction with our co-venturer CQ Partners is proud to receive the Best Weather Broker for Australia Award in Environmental Finance’s 2013, 2014, 2015, 2016, 2017 and 2018 Annual Rankings in relation to weather risk management.