The future of the London Array plan to supply some 750,000 homes with electricity from 341 turbines in the outer Thames Estuary had been in doubt since Shell pulled out earlier this year, citing escalating costs.

"We're pleased that, together with DONG Energy, we've been able to secure the future of the project," Paul Golby, Chief Executive of E.ON UK, said on Monday.

"We hope to be able to keep the project on track and we should be able to complete the first phase by the end of 2012, subject to securing a number of important contracts, such as those for the wind turbines."

E.ON and Dong Energy will become 50:50 partners in the project after buying out the third partner for an undisclosed sum.

The British government needs wind power to grow rapidly over the next decade to stand any chance of reaching tough European Union renewable energy targets for 2020.

But planning, grid connection and turbine supply problems have frustrated growth to date.

Approval for SSE's 600 million pound (US$1.20 billion) Clyde wind scheme in South Lanarkshire, comes three months after Scottish Ministers rejected plans for what would have been Europe's largest onshore wind farm on the Isle of Lewis, citing concerns over its impact on local wildlife.

EU TARGETS

"Projects like Clyde are essential if Scotland and the UK are to have any hope of meeting legally-binding EU targets for renewable energy," SSE Chief Executive Ian Marchant said.

The 152-turbine Clyde project became part of SSE's development plans when it bought Airtricity earlier this year and construction work is expected to begin later in this financial year.

Commissioning of the first phase of the project is scheduled for 2010, with completion of both phases expected in 2011.

Much of the electricity that produced on the wind-swept hills of Scotland is expected to be sent south to England but the UK power network needs upgrading to transport it.

Iberdrola of Spain's UK arm, ScottishPower, said on Monday it had opened two new electricity sub stations in South Lanarkshire as part of a wider programme to increase Scottish electricity export capacity from 2,200 MW to 2800 MW by 2010.

"This is a significant milestone in the project to increase the capacity of the Scotland-England interconnector," Alan Bryce, director of energy networks at ScottishPower, said.

"The development of renewable energy projects in Scotland is increasing all the time so it is vital that there is suitable infrastructure to support this growth."

To see a WRAPUP on E.ON and Dong buying the Shell stake in London Array, please click on

(Editing by Anthony Barker)