A fresh wave of hurricane-strength winds was forecast to hit large parts of Britain this morning. Gales exceeding 80mph started at 4pm yesterday and were expected to combine with heavy snow to cause large-scale disruption to transport and power supplies.

The Met office issued a severe weather warning from 9pm yesterday until 3pm today for Northern Ireland, southwest Scotland, the North of England, North Wales and the Midlands.

The storm could cause significantly more damage than Monday's weather because it covers a larger area, a spokesman said. "Unlike yesterday's storm, we're expecting this one to affect most of the country," he said.

"Unfortunately high winds will combine with blizzards in northern England and southern Scotland. We expect it to cause disruption to transport and there may be damage to buildings and trees."

The Environment Agency issued 30 flood watches and seven flood warnings last night, focusing on the northwest of England along the Lancashire and Cumbria coastlines.

A hospitality company at the Cheltenham Festival was forced to offer refunds to 2,400 people who had booked tickets for a 300-seat marquee that was destroyed on Monday morning.

Gale-force winds ripped down the restaurant marquee operated by Keith Prowse. The restaurant, which is out of commission for the entire four-day festival, offered champagne and a four-course lunch for between £369 and £569 a head. Festival organisers said racing had not been affected, but admitted that strong winds could lead to the cancellation of some races.

Weather conditions in the South West and Wales had "vastly improved" yesterday, the Environment Agency said.

A flood watch was still in place for the coastline from Chichester Harbour to Selsey Bill and Broad and Earnley Rifes in Selsey.

Fifty caravans were destroyed when the storm night washed away an 800-metre (875yard) section of the shingle bank at Chichester Harbour. Environment Agency staff used bulldozers and excavators to rebuild the defences as much as possible before yesterday's high tides at 2pm. The storms left thousands of homes without power, while flights from Heathrow and Gatwick were affected, and road and rail routes disrupted.

The European Parliament approved a £120 million aid package yesterday for English regions, mainly Gloucester-shire and Hull, hit by the devastating floods last summer.

Insurers have already paid out £3 billion after the floods. The Association of British Insurers welcomed the aid, but said the Government had to formulate an investment strategy to reduce the risks of future flooding The grant will go towards the cost of emergency flood relief, the clear-up and restoration of basic services.