Swedish tidal energy developer Minesto, and Faroese company Sev, have renewed and updated the power purchase agreement (PPA).
The price level is adjusted to reflect the total system value of tidal energy in the Faroe Islands’ future 100% renewable energy mix.
“ The updated PPA is on a price-level that underlines the value of tidal energy in energy mix in the Faroe Islands,” said Martin Edlund , CEO of Minesto.
The PPA between Minesto and Sev, initially signed in 2020 , is now updated and renewed for two more years following approval from the Energy Agency in the Faroe Islands (Orka).
The PPA covers the capacity of three tidal power plants in Vestmanna and extends the first off-taker relationship where energy from Minesto’s tidal energy dragons is supplied.
“We are pleased to sign a renewed power purchase agreement with Minesto at this point. We are very hopeful that tidal energy will play a vital role in the future energy mix in the Faroe Islands and in our efforts to reach 100% sustainable electricity generation by 2030,” said Terji Nielsen , Head of R&D at Sev.
In January 2023, the two companies renewed and expanded the existing collaboration agreement related to tidal energy buildout in the Faroe Islands. An important add-on to the extended agreement stipulates the exclusive nature of the collaboration regarding the Hestfjord site development and build-out , according to Minesto.
Minesto upgraded its roadmap to a 200 MW tidal energy buildout in Faroe Islands in February 2024, targeting Hestfjord as the first site for build-out, where Minesto is engaged with SEV in site development activities.