Offshore Electricity Transmission (OFTO)

Offshore electricity transmission connects windfarms at sea to the onshore transmission network. Offshore transmission plays an important role in our future electricity generation and will help with our transition to clean power by 2030. We manage the process of bringing energy generated at sea onshore by: 

• selling the transmission assets, through a competitive tender process  
• granting offshore transmission owners the licences they need  

We make sure we partner generators with the most efficient and cost-effective transmission owners in the market. We aim to lower costs and improve service for everyone involved, including consumers. 

How the OFTO tendering process works  

The tendering process is divided into rounds, where bidders compete to own the offshore electricity transmission assets connecting specific wind farms to the onshore electricity network. These assets might include any offshore platforms and associated substations, export cables, the onshore substation and onshore cables.  

We assess each bid to make sure we only certify and select OFTOs that can deliver an efficient, reliable service, at the lowest cost possible to consumers. OFTOs get a range of benefits, including:   

• a stable source of regulated income    
• long-term, inflation-linked income security (licences are typically granted for a period of 25 years)   
• the National Electricity System Operator (NESO) as revenue counterparty  

Within each round we issue transmission licences for specific assets connected to offshore wind farms around Great Britain (England, Scotland and Wales).  

The developer then sells the assets to the successful bidder.  

After we issue the licence, we regulate the activities of the companies. We do this under:  

• sections A and E of the standard transmission license conditions  
• the conditions of the offshore transmission license specific to the tender round  

We publish details of any regulatory activity on our website.  

OFTO and the law

 Ofgem introduces new regulations for the OFTO tender process under the Electricity Act 1989.  

 The current rules all parties involved in the tendering process are set out in the Electricity (Competitive Tender for Offshore Transmission Licences) Regulations 2015.  

Learn more about becoming an offshore electricity transmission owner (OFTO) 

 If you're new to the OFTO tender process or have any questions about participating, our team is happy to help.   

 Email us at [oftoteam@ofgem.gov.uk]