Ofgem has drawn its largest field of bidders in six years for the next wave of offshore transmission assets, underlining growing investor appetite for the UK’s clean power infrastructure.
Five bidders are now competing to own and operate the transmission links connecting three major North Sea wind farms, East Anglia THREE, Inch Cape and Dogger Bank C, to the grid.
The assets, valued at around £3.5 billion, include offshore and onshore cables, substations and converter stations that will carry renewable power to millions of homes.
The scale of interest marks a big shift After a quieter period, both established players and returning investors are back in the OFTO market, attracted by the model’s long-term, inflation-linked revenue streams and relatively stable returns.
Beatrice Filkin, Director of Major Projects at Ofgem, said: “Recently, we’ve seen how geopolitical events can impact both energy security and investments.
“Ofgem’s OFTO regime not only helps boost British energy security but also offers investors a safe and steady asset for their portfolios.”
The bidders will now move into the final stage of the process, submitting formal tenders before Ofgem selects preferred owners who will be granted licences to operate the assets.
Since launching in 2009, the regime has brought more than £10 billion of private investment into offshore transmission, funding links for 28 wind farms while keeping costs down for consumers through competitive tendering.
Ofgem expects up to £6 billion of assets to come to market each year to 2030 as offshore wind deployment scales, with the next tender round due to launch later this year.
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