A deal has been struck to install tidal kite technology in waters surrounding the Faroe Islands.
The agreement, between Swedish marine energy business Minesto and Faroese power firm SEV, encompasses the installation, commissioning and operation of two of Minesto's DG100 models.
SEV has also committed to buy the electricity produced by the technology through a power purchase agreement, Minesto said in a statement Monday.
Weighing between one and two tons, the DG100 model has a wing span of four to six meters and a power rating of up to 100 kilowatts.
Minesto's technology harnesses underwater current, which creates a hydrodynamic lift force on its wings, pushing it upwards. A rudder steers the kite in a figure of eight trajectory and as it "flies", water flows through the turbine, producing electricity.
"As a remote island society, we don't have the option of buying electricity from neighboring countries," Hakun Djurhuus, SEV's CEO, said in a statement.
"For the last year, we have carried out tidal stream measurements, as tidal energy at the right cost level can be one important piece of the puzzle," Djurhuus went on to add.
A site for the installation of Minesto's technology has been identified in Vestmannasund, a strait in the north west of the Faroe Islands. The first unit is to be installed at the end of 2019 or beginning of 2020, while the second will be installed in 2020.
The European Commission has described "ocean energy" as being both abundant and renewable. Ocean energy could potentially contribute around 10 percent of the European Union's power demand by 2050, according to the Commission.