Minesto, a Swedish tidal energy developer, is leading a consortium of four that has been awarded a SEK 25 million (approximately $2.6 million) grant funding from the Swedish Energy Agency to build a complete microgrid installation in the Faroe Islands.
The consortium includes Minesto, microgrid technology provider Capture Energy, Faroese utility company SEV, and IVL Swedish Environmental Research Institute. The total project budget over two years amounts to SEK 56 million, of which SEK 25 million is covered by the Swedish Energy Agency grant.
The project aims to demonstrate a tidal-based microgrid solution that delivers baseload power. According to Minesto, it builds on a partnership with Capture Energy, a technology provider specializing in microgrid management. By integrating Minesto’s tidal power plants with Capture Energy’s systems, the project is said to seek to access the global market for autonomous and island-mode grid solutions.
SEV, an existing customer of Minesto, is said to contribute as a microgrid user and support feasibility work for future commercial installations. IVL will assess the environmental footprint of the system.
Targeting remote, non-grid-connected sites in the Faroe Islands, the project is scheduled to begin in August and deliver a complete microgrid by 2026.
“The global multibillion-Euro microgrid business is a vital parallel track to build-out of larger Dragon Farms (multimegawatt arrays) based on the same Dragon-class systems. This new partnership with Capture Energy makes it possible for us together to offer turn-key microgrid tidal power generation to local customers in need of renewable base-load energy,” said Martin Edlund , CEO of Minesto.
The microgrid market is a key strategic focus for Minesto, with an estimated €300 billion (approximately $352 billion) in addressable value spanning small kW installations to large multi-megawatt (MW) installations.
“The microgrid business has significant strategic value for Minesto. It is in itself a substantial global market and it also offers market entry projects with new commercial partners to create confidence in our unique technology and to speed up collection of local data for environmental permitting and certification,” Edlund added.
Minesto said the Faroe Islands face energy challenges common to remote island communities, including dependency on imported fossil fuels, price volatility, and supply disruptions. The region is said to have untapped tidal energy potential that the company aims to harness.
“This award from the Swedish Energy Agency adds vital financial support and recognition to Minesto’s commercial agenda,” Edlund concluded.
Just recently, Minesto secured a SEK 22 million loan from Fenja Capital to be used as working capital for its ongoing operations and business development.
Minesto’s upgraded Dragon 12 tidal energy device, deployed in Vestmannasund, Faroe Islands, reached a performance milestone, delivering a 25% increase in power output following the installation of a longer tether.