What Became of Minesto's EIC Accelerator Underwater Tidal Kites

Most tidal turbines need water racing past at more than 2.5 metres a second, and only a handful of places on earth have it. Minesto, a Gothenburg company spun out of Saab's wind department in 2007, takes a different route: it tethers a wing with a turbine to the seabed and steers it in a figure of eight, so the kite moves through the water several times faster than the current itself. That, the company says, makes slow currents worth harvesting.

In the 3 April 2019 cut-off of the EIC SME Instrument Phase 2, the forerunner of today's EIC Accelerator, the European Commission selected Minesto's DGIM2 project, "Deep Green Island Mode 2", according to the official list of winners, which names Minesto AB in Västra Frölunda as the only company for the project. CORDIS records an EU contribution of €2,499,995 towards a total cost of €6,128,625, from 1 August 2019 to 31 July 2021. The task was to install the first two "commercially viable" island-mode kites in a customer's grid in the Faroe Islands. Minesto did that. Seven years after the award, no sale of a power plant has been announced.

Where Minesto Stands Now

Minesto is active and still in development. Its half-year report for 2026 shows net sales of SEK 0, again, an operating loss of SEK 15.4 million and cash of SEK 38.4 million at the end of June. Its operating income of SEK 11.3 million consisted entirely of staff costs booked as development work. The same report says the smaller Dragon 4 kite set an electricity production record in Vestmannasund over the summer of 2026 after its power take-off was upgraded, and that a Faroese advertising campaign built around the kites won the Grand Prix at Cannes Lions.

The megawatt machine is idle. In February 2026 Minesto said the 1.2 MW Dragon 12, grid-connected since May 2025 after an upgrade, was in "park-mode as a precaution" because its preventive maintenance intervals had been exceeded, according to Energy Global. The company's year-end report for 2025 gives the reason: reduced access to "cost effective marine operational resources", because its local installation vessel was in service.

The Technology: A Kite Instead of a Turbine Tower

Conventional tidal turbines sit on the seabed or hang from a floating platform and turn as the current flows through them, so their output depends on the speed of the water. Minesto's kite carries a small turbine and generator on a wing, held by a tether. Flown in an eight-shaped path, the wing reaches "8-10 times the speed of the actual current", the DGIM2 proposal says on CORDIS. The project's final report claims the kites can work economically in currents from 1.75 metres a second and depths beyond 60 metres, sites that it says make up "at least half of the tidal sites and most of the ocean current sites globally".

The other selling point is weight. CORDIS quotes Minesto's claim that its plant is "up to 15 times lighter per kW" than other tidal devices, which should make it cheaper to install with small boats. Those are the company's figures; no independent comparison of cost per kilowatt-hour against seabed turbines has been published. What has been checked independently is the power curve: in July 2021 Minesto said DNV had verified the production curve of its Faroese kite under the IEC 62600-200 standard, with a peak of 139 kW and an average of 92 kW per lap.

What DGIM2 Promised, and What CORDIS Shows

DGIM2 was the second phase of a small feasibility study, DGIM, for which North Data lists €50,000 of Horizon 2020 money in 2018. The second phase had a concrete target. Work started with the Faroese utility SEV, which helped select the Vestmannasund strait in autumn 2019; all licences and permits were in place by summer 2020, the CORDIS report says. Minesto installed the first 100 kW DG100 kite in October 2020 and delivered its first electricity to the Faroese grid in December 2020 under a power purchase agreement with SEV. A second kite, named "Drekin", was delivered in March 2021 and went straight into production, according to Ocean Energy Europe.

By the end of July 2021, the report says, both plants "had delivered electricity to the Faroese grid over full tidal cycles with satisfactory performance", and SEV had extended its power purchase agreement to 2023. The project also moved sensitive electronics from the kite to a shore station and developed a new anchoring system that small vessels could install, even in winter. The CORDIS team summarised the results in a December 2021 results article.

1. Site, permits and grid agreement in the FaroesDeliveredVestmannasund chosen in 2019, permits by summer 2020, power purchase agreement with SEV, per CORDIS.
2. Two island-mode kites installedDeliveredFirst DG100 in October 2020, second in March 2021, both inside the project period.
3. Electricity to a customer gridDeliveredFirst power in December 2020; DNV-verified power curve in July 2021.
4. Commercial ties with utilities across EuropePartialNo sale of a power plant and no grid deal with another European utility has been announced.
5. Replace diesel in island microgridsNot yetA battery-backed tidal microgrid at Vestmanna was still being prepared in 2026.

On its own terms, DGIM2 delivered and on time: the two kites, the grid connection and the verified output all happened inside the 24 months. What it was meant to unlock, a commercial product for island grids, has not followed. The "Microgrid" demonstration with battery storage at Vestmanna, a SEK 56 million project shared with Capture Energy, IVL and the Swedish Energy Agency, was still at the preparation stage in February 2026, Energy Global reported.

What Minesto Has Done Since

The company scaled up the kite rather than selling the small one. In January 2023 SEV and Minesto extended their partnership, making it exclusive for Hestfjord, the site of a planned first tidal array, and installation of a 1.2 MW Dragon 12 began. That kite was installed and grid-connected in February 2024, according to Wikipedia and the company's year-end report for 2024, which also says the specification for a 10 MW first phase at Hestfjord was completed in December 2024 and that EY had been hired to find investors. Minesto now talks of 200 MW across the Faroe Islands by 2030, according to its September 2025 rights issue announcement. No investment decision for Hestfjord has been announced.

Outside the Faroes, the record is thinner. The Welsh Government awarded Minesto €14.9 million of EU regional funds in 2019 for an uprated kite and permits towards an 80 MW farm at Holyhead Deep, on top of €13 million in 2015, Marine Energy Wales reported. In 2025 Minesto closed its Holyhead office and cut its staff by about 35% to 36, according to Reuters; Wikipedia gives the same figure. How much of the Welsh money was paid out could not be verified. Minesto also won about €2.4 million through the EU-funded TIGER project to install a DG100 at EDF's Paimpol-Bréhat test site in France, it said in a company release; whether the kite was ever installed there could not be verified.

The Money

Minesto has never reported meaningful sales. Its operating loss rose from SEK 13.1 million in 2020 to SEK 20.1 million in 2021, according to Offshore Energy, then to SEK 23.7 million in 2022 (year-end report 2022), SEK 28.7 million in 2023 and SEK 37.3 million in 2024, before easing to SEK 34.7 million in 2025 after the staff cuts. Net sales were SEK 75,000 in 2024 and zero in 2025.

The balance sheet shows large equity, but most of it is development work that the company has capitalised. At the end of June 2026 equity was SEK 615.4 million, of which SEK 569.7 million was capitalised development costs and SEK 18.7 million capitalised patents, the half-year report shows. Cash was SEK 38.4 million, down from SEK 67.6 million six months earlier.

The cash comes from shareholders. In October 2025 Minesto sought about SEK 152.4 million in a rights issue at SEK 1.85 a share. Only 41.3% was taken up directly; guarantors covered another 23.7%, and the company raised about SEK 99.0 million, according to its announcement of the outcome. The lender Fenja Capital set off about SEK 22.2 million of loan claims against new shares, the year-end report for 2025 says. Shareholders who stayed out were diluted by about 20.6%. Minesto shares were first sold at SEK 5.60 when it listed in November 2015.

Why Europe Should Care

Ocean energy has an explicit EU target. The Commission's 2020 offshore renewable energy strategy aims for 1 GW of wave and tidal capacity by 2030 and 40 GW by 2050, and calls ocean energy crucial for decarbonising EU islands, as Ocean Energy Europe summarised it. Tides are predictable in a way wind and sun are not, which is why SEV's chief executive called tidal power "more stable than e.g. wind power" when the first kite went live. A technology that works in slow currents would widen the number of usable sites far beyond the few fast straits that seabed turbines need.

The 1 GW target is four years away, and in the Faroes Minesto operates one megawatt kite, currently parked, and the smaller Dragon 4. Its first array, Hestfjord, still needs investors. The gap between the policy and what has been built is not Minesto's alone, but it is visible in its record.

The Verdict

Minesto has not been asked for comment for this article. It is based entirely on public records, company statements and EU project data, linked throughout.