A pioneering deal under which the wind farm industry will spend at least £16m on advanced radar defence systems has cleared the way for a significant boost in the UK's supply of renewable energy.

Wind energy projects across Britain have been held up for years because of planning disagreements, some concerned with interference from turbines that can baffle air-traffic control and defence systems, creating blind spots in coverage known as 'blackout zones'. The fear is that hijacked airliners or incoming hostile bombers could evade detection.

The agreement involves a consortium of wind power firms purchasing US-manufactured Lockheed Martin radar equipment so that Britain's sensitive eastern airspace approaches can be protected after new turbines are erected around The Wash.

The radar will be based onshore in Norfolk. As its part of the agreement, the Ministry of Defence has lifted planning to objections to five new, offshore wind farms that will contain almost a thousand wind turbines. The deal is expected to trigger a fresh wave of wind farm applications.

The wind-driven turbine blades can rotate at up to 200mph, mimicking on-screen the appearance of slow-moving aircraft and showing up as a blur of images. Simply discounting the clutter is dangerous because the images obscure patches from which planes could suddenly emerge; there are fears that hijacked airliners or bombers could evade detection.

The RAF and the renewable energy industry have been negotiating for years over the problem. A number of technical fixes are being explored, including applying radar-absorbing material to turbine blades to render them invisible to radar.

The defence contractor Raytheon has been commissioned by the UK's National Air Traffic Services (NATS) to develop improved radar systems that can discriminate between aircraft and wind turbines.

The new spirit of co-operation between the MoD and windfarm developers follows adoption of the government's aviation plan in 2008. Release of military research reports has helped generate some common understanding.

"There now seems to be quite a degree of momentum," said Nicola Vaughan, head of aviation at RenewableUK, the industry body that represents wind, wave and tidal power firms.

"The MoD have started to lift their objections, particularly to offshore turbines, [following] this solution… There's around 1,000 new turbines – 3.2 gigawatts of power [on the Wash] – which now stand a chance of being built, because the MoD objection was the last significant [hurdle]."

The Lockheed Martin Air Defence Radar TPS 77 system, which cost about £20m, will be paid for by the windfarm developers, the Crown Estate on whose submerged land the turbines will be built, and the Department of Energy and Climate Change, which is contributing £4m. The Crown and the developers, which include Scira Offshore Energy, Centrica, NPower and Warwick Energy, have paid the rest.

The Sheringham Shoal offshore windfarm, with 88 wind turbines and already under construction, will be the first to be completed. There are applications for about 3,000 further turbines, equivalent to 6GW, now going through the planning process, according to RenewableUK. Proposals for an additional 3,000 turbines are at earlier stages of development.

The MoD said it needed to ensure aircraft safety, adding: "By installing an additional radar in Norfolk we will significantly reduce the negative impact of the turbines on MoD business."

• This article was amended on 4 May 2010. Due to an editing change, the original said that the new radar system would be sited in the offshore windfarms, which would double as radar defence systems. This has been corrected.