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The government's Energy and Climate Change Secretary Amber Rudd approved the building of the wind farm, known as the Dogger Bank Teesside A & B project, which will see 400 turbines built in an area of the North Sea spanning 600 square kilometres.
When completed, the site, 165 km off the northeast coast of England, will have the capacity to generate 1.2 gigawatts of energy, enough to power the annual electricity needs of two million homes.
The British and Norwegian project partners in the Forewind Consortium - RWE, SSE, Statkraft and Statoil - estimate the project could create up to 4,750 direct and indirect jobs and generate more than 2.15 billion U.S. dollars for the British economy over its lifetime.
Earlier this year the Forewind consortium received planning approval for another North Sea wind farm installation in another party of the Dogger Bank sea area, described at what will be the biggest offshore windfarm in Britain.
The larger Teesside A&B site is further out into the North Sea than its sister site, but as it sits in one of the shallowest areas of the North Sea, it will make construction of the new wind farm easier. The water in the area is around 25 meters deep.
Each of the turbines will rise 100 m above sea level, with the foundations drilled 40 meters into the seabed.
Power from Dogger Bank Teesside will come to shore on Teesside between Redcar and Marske-by-the-Sea, connected to Britain's national power grid through a nine km onshore cable.
In a statement Wednesday the Energy and Climate Change Minister Lord Bourne said: "Thanks to government support the UK is the world leader in offshore wind energy. As we build the Northern Powerhouse, we want local communities to reap the benefits of investment and green jobs from low carbon developments like Dogger Bank Offshore wind project."
Consortium spokeswoman, Maria McCaffery, CEO of RenewablesUK, said: "This awe-inspiring offshore wind project has taken another significant step forward. The sheer size of Dogger Bank illustrates just how large the environmental and economic opportunities are in the North Sea for the UK's world-leading offshore wind industry."
