Tender Round 14 in Ofgem’s Offshore Transmission Owner (OFTO) framework, which launched on Wednesday, October 21, has an estimated value of around £3.5 billion.
The 14th OFTO regime Tender Round will see investors compete to own and operate the transmission assets for Hornsea 3, one of the world’s largest offshore wind farms under construction.
Located over 100 km offshore in the North Sea, the project is due for completion by the end of 2027 and is projected to be able to power 3.3 million UK homes.
Under the OFTO regime, successful bidders receive a long-term, inflation-linked revenue stream for financing, operating, and maintaining prebuilt transmission assets (which include cables and offshore and onshore substations). Ofgem’s competitive tender process is designed to keep costs down for consumers and maintain high standards of performance.
Beatrice Filkin, Ofgem’s Director of Major Projects, said: “Hornsea 3 is one of the world’s biggest wind farms. The offshore connection linking it to the onshore grid will help deliver home-grown energy to millions of British consumers as well as providing a great long-term opportunity for investors.
“By running a competitive process, Ofgem is helping attract the investment Britain needs for a cleaner, more secure energy system while making sure consumers get value for money.
“We’d encourage any would-be investors interested in finding out more about this major opportunity to get in touch and learn more about the process.”
Since its launch in 2009, the OFTO regime has seen winning bidders invest over £10 billion in links connecting 28 offshore wind farms.
Read more about the OFTO regime.
The OFTO framework forms a key element of the once-in-a-generation modernization of Great Britain’s energy system. It helps deliver clean electricity to homes and businesses and to meet the growing demand from transport, heating, industry, and data centers.
This also strengthens energy security by making greater use of Britain’s renewable resources and reducing exposure to volatile global gas markets.
