IJ can today reveal details of a massive investment strategy in UK renewable power that has been designed to give the offshore wind market a shot in the arm.

Infrastructure Journal has learned of a £2 billion investment opportunity  in an exclusive interview with energy minister Malcolm Wicks and senior members of Ofgem and DBERR (department for business, enterprise and regulatory reform).

The investment is designed to drive developments in offshore wind by removing transmission risk - primarily for Round 2 offshore wind farms that was rolled out last year.

Ofgem will this year launch tenders for investment opportunities in offshore transmission networks and is looking to the infra funds, transmission companies, cable layers and utilities to take up the slack.

This regime is targeted at cable connections of 132kv and above - essentially the large Round 2 projects - which are located in strategic areas:

• The Greater Wash
• Thames Estuary
• off north west Wales and north England

Energy minister Malcolm Wicks said: "This is a significant investment opportunity for the offshore industry. Allowing companies to compete for licences for these new grid connections should mean they are delivered on time and at best cost to developers and consumers.

"Meeting the EU's renewables proposals will mean a significant expansion of both onshore and offshore wind.  The UK has the best offshore wind resource in Europe and the framework we are putting in place will ensure security of supply and the prospect for this low carbon energy source to be fully harvested."

The first two rounds of licences for offshore wind amount to 8GW with the first license acting as a demonstration round for the sector with just 1GW. Round 2 amounted to 7GW and interconnect has long been an issue in its uptake.

Currently there are 404MW of offshore wind farms operational off the UK coastline with 434MW under construction and 2GW sitting with planning permission in place.

Round 3 could amount to as much as 25GW, but this investment is targeted at getting the second round in motion and can be extended to encompass the third licensing as it develops.

These are targeted as the test run investments to hook up offshore wind farms to the national grid as a priority.

Ofgem has a number of key locations in mind where sizeable offshore wind farms are progressing and these projects are to finance radial connections from the onshore grid network to each site offshore.

Overall the early-days estimates have it at £2 billion of transmission investments needed to hook up Round 2 projects with point-to-point connections.

The beauty of these concessions is that the energy minister is proposing to offer them over 20 years - far longer than the 5-year licenses for onshore.

From the offshore generator's point of view, they can outsource the cost of paying for these interconnects and offload the construction risk.

From the offshore transmission company's perspective, it gets a guaranteed revenue stream for the life of the project.

Ofgem and DBERR have just launched a consultation document as it will involve a number of changes to existing codes and licenses to put the regime in place.

It will on 18 February host a seminar in London to discuss the potential of the project. This will be hosted by Malcolm Wicks along with representatives of Ofgem, DBERR and Crown Estate. The event is being managed by Gavin Anderson & Company.

The first tenders are slated to be running in 12 months' time.

Demand is dependent on offshore generators, but Wicks hopes that once the regime is in place, it will improve offshore wind's attractiveness to investors, while at the same time looking for best value.

Ofgem is currently in consultation with industry professionals to identify sweeteners like performance incentives, but the primary goal is to ensure that they are built to time and on cost.

This is clearly a move by government to drive investments in offshore wind which has not progressed as quickly as it had hoped, matched by the UK onshore wind industry which struggles to get its facilities through planning departments.

The latest high-profile onshore wind deal to bite the dust was Amec's mega facility that was planned for the Isle of Lewis, off the coast of Scotland, which was recently scrapped after years battling its way through the planning system.

Putting together a package that finances an economic and efficient grid connection to shore may prove to be the tipping point that makes offshore wind power in the UK more attractive to developers and investors.