The Prime Minister's strategy to tackle climate change by switching to renewable energy is based heavily on plans to build vast wind farms of up to 300 turbines off the British coast by the end of the decade.
The Government had gambled that offshore schemes would generate up to four gigawatts of electricity, meeting about 40 per cent of the total renewables target for 2010. But fears are now mounting that this target could be missed by a wide margin.
Senior industry experts and officials in the Crown Estates, which awards offshore licences, admit the UK will miss its first key target to build 17 offshore wind farms by 2007 - by as much as 50 per cent.
The much more ambitious proposals to build the far larger 300-turbine schemes off the Wash in Humberside, the Thames estuary and Morecambe Bay in north-west England by 2010 are also facing significant problems, senior sources concede privately.
Initial estimates suggest the offshore wind farms built under Round 2 will generate only 2 to 3GW of electricity by 2010, compared to a maximum possible of 7.2GW.
Renewable energy campaigners and industry officials claim the biggest stumbling block is problems with the electricity regulator, Ofgem, over funding new grid connections.
Global steel prices have also doubled, increasing the costs of building the towers. And City investors are still far more cautious about funding these schemes than ministers and developers had hoped.
"With Round 1 it would be difficult to deny that it has proved a lot slower than we'd hoped," said Gordon Edge, head of offshore at the British Wind Energy Association, which represents 310 renewable and power firms.
Sorting out the problems with Ofwat was essential for the Round 2 schemes to succeed: "There needs to be some political heads knocked together to relieve this issue," said Mr Edge.
Stephen Tindale, head of the campaign group Greenpeace, which has close ties to Npower's offshore scheme in North Hoyle, off North Wales, said: "There seems to be no sense of co-ordination and no sense of urgency in the Government."
Ofgem and the Department for Trade and Industry insisted they were committed to meeting their 2010 target. Ofgem will release plans for a national strategy on new grid connections for renewables later this year, and has set aside pounds 1bn to improve the grid generally.
Mike O'Brien, the energy minister, said another pounds 1bn a year would come on stream by 2010. "No one has ever claimed the target isn't ambitious, but the political will is there to achieve it."Reuse content