PLANS for the biggest upgrade of Scotland's electricity in 60 years are being fast-tracked to help make it the world leader in renewable energy by 2020.

Around 3000 jobs will be created by the £7 billion-plus investment in the next few years if all the projects go ahead, boosting Scotland's attempts to recover from the economic downturn.

Vital new connections will be built, after industry regulator Ofgem unveiled the plans yesterday, to handle the huge power output that will be generated by Scotland's wind and wave farms.

The joint investment by ScottishPower and SSE companies, which will be funded by a 35p levy on every UK household energy bill, is seen as key to supplying power to more than six million UK homes.

Frank Mitchell, chief executive of ScottishPower Energy Networks, said: "This will be the most significant investment in electricity infrastructure to have taken place in the past 60 years."

He added: "Our planned investments will see widespread modernisation and a fit-for-purpose network capable of supporting a 21st-century electricity system."

The announcement fits with the Scottish Government's manifesto pledge to generate 100% of the country's energy from renewables. It is believed Scotland has the potential, through wind and wave power, to provide up to one-quarter of the EU's total renewable energy.

Energy Minister Fergus Ewing said: "The scale of investment is significant.

"I expect the companies to deliver the essential grid upgrades, a future grid network that connects and transports our outstanding energy potential to homes and businesses across Scotland, and from Scotland to other markets."

However, Ofgem was accused by a conservation charity of jumping the gun.

The John Muir Trust said the regulator had failed to properly consult. The final plans will be published by April.

Helen McDade, head of policy at the trust, said: "You have got to ask: where is the opportunity to question or debate this? This is going to be like Beauly-Denny all over again. First you are told it needs to happen. Then Ofgem allows them to take the money on very favourable terms, while they are supposed to be consulting. So it does have the look of something that is going to go ahead.

"It is all predicated on all major renewable projects going ahead, but most are waiting for public inquiries. So where is the democracy there?"

She also questioned Ofgem's 35p levy, which will be added to bills over eight years from 2013.

The regulator has the power to restrict what the power companies charge for transporting their electricity, but it wants to allow the two main ScottishPower companies to charge consumers £2.9bn between 2013 and 2021, with a further £4.7bn being allowed for additional projects approved by Ofgem.

On the 35p levy, Ms McDade added: "They are going to have to show how they get that, as quite frankly nobody I know with technical expertise thinks that is credible – £35 perhaps."

The £7bn would be invested in electricity transmission networks, including vital new connections to the islands and possibly up to 600 miles of subsea cables to England.

ScottishPower is to create up to 1500 new jobs and SSE sources indicated it would employ a similar number.

SSE subsidiary, Scottish Hydro Electric Transmission Ltd (SHETL), is planning an initial £1.1bn investment programme, which includes the final stages of the Beauly to Denny line. But there is also flexibility to increase this

by up to a further £4bn, if required. It is in this latter category that the long-awaited interconnector to the Western Isles and Orkney, and from Moray to Shetland will appear.

Mark Mathieson, SSE's managing director for Networks, said: "Ofgem's decision is a major step forward in our plans to deliver the major capital investment programme required for the transmission network in the north of Scotland, that will facilitate the expected growth in renewable generation over the next decade."

Scottish Power Transmission (SPTL) is allowed by Ofgem to spend up to £2.6bn over the eight years on the scheme.

It aims to provide around 11GW – enough to power six million homes – from the connection of offshore and onshore wind generation.

Other objectives include more than doubling export capacity to England to around 7GW by 2021 and the replacement of 500 miles of overhead line and 15% of the company's substations.

Angus Campbell, the leader of Western Isles Council, said it could lead to more than £1bn of inward investment in renewables for the Outer Hebrides. Mr Campbell said: "Ofgem's decision will lead, at long last, to the establishment of a highly positive investment climate for renewable energy projects in the Outer Hebrides, Orkney and Shetland."