Background Ocean energy is one of the largest untapped renewable energy sources. The potential from offshore areas within just 12 miles of EU coast is estimated to be 19 000 MW (Munk and Wunsch, 1998). This figure grows to 114 000 MW if unexploited and virgin offshore areas further than 12 miles are included. Wind farms and ocean-energy farms for harvesting tidal energy should, in the future, be coupled, to offset costs of expensive electrical grid connections and offshore installations. However, the ocean-energy industry is currently 20 years behind that for wind energy. Though initially slow, the wind industry experienced an annual growth rate of 48% from 1971 to 2004. By 2006, it had a collective annual turnover of more than €12 billion and employed 60 000 people worldwide. The 2006 OECD/IEA report estimates a growth rate of 46% from 2004 to 2030 for the ocean-energy industry. Assuming a worldwide extractable tidal potential with present technologies of 62 000 MW, the anticipated saving in carbon emission is over 72 million tonnes per year. Furthermore, the predictability of tidal energy gives it an important competitive advantages over wind and solar power. Objectives The BLUETEC project aims to demonstrate the technical feasibility and cost effectiveness of a full-scale 1 MW tidal-energy installation. It thus hopes to demonstrate the technology’s potential to significantly reduce CO2 emissions and improve Europe’s competitiveness in exporting innovative and renewable technologies. This demonstration project will establish a tidal installation composed of four innovative Kobold turbines, rated 250 kW each. These will be mounted on a 40m x 20m floating steel platform attached to the sea bed with two lines of catenary mooring. The project expects to show that Bluetec is the best and most reliable device currently available, even in harsh sea conditions. Specific objectives are to produce 1 600 MWh per year at a cost of €0.34/kWh. Costs are expected to be initially comparable with solar energy and decrease over time with expansion of the technology. BLUETEC should show a CO2 reduction of 652g/kWh or 1 045 tonnes of CO2 per year. Evidence from the project will be used to work with the EU and five European countries where tidal energy is commercially exploitable to simplify the regulatory framework for offshore technologies. Expected results: Demonstration of the feasibility and reliability of a 1.0 MW Bluetec tidal-energy installation; Generation of 1 600 MWh/yr at €0.34/kWh; Prevention of 1 045 tonnes CO2/yr; Generation of reliable data, which could inform regulatory change.