Minesto AB: Transitioning from Innovation to Commercial Scale in Tidal Energy

The first quarter of 2025 has been a transformative period for Minesto AB (MINEST), a Swedish pioneer in tidal energy technology. The company’s interim management statement reveals a strategic shift from R&D to large-scale deployment, fueled by technical validation, strategic partnerships, and robust capital raises. This progress positions Minesto as a leader in harnessing low-velocity tidal streams—a niche it claims as uniquely its own.

The Hestfjord Breakthrough: Validation and Viability

Minesto’s Hestfjord project in the Faroe Islands is the linchpin of its commercial ambitions. The company’s Dragon-class technology, validated by DNV’s independent review, has secured a critical seal of approval for scalability. This endorsement is pivotal for attracting investors and policymakers. A key revelation was that Hestfjord’s tidal energy content exceeds initial estimates, boosting the project’s projected annual production yield. This improves the economics of the 10MW Phase 1 farm, which is now a gateway to a 200MW buildout roadmap.

The Faroe Islands’ engagement has also deepened. A seminar in Tórshavn highlighted local enthusiasm, with stakeholders now aligned on the project’s environmental and economic benefits. Minesto’s relaunch of the Dragon 12 test unit and upgrades to Vestmanna’s marine infrastructure underscore its operational focus on turning technical success into grid-connected power.

Strategic Partnerships: Marketing Meets Global Expansion

Minesto’s partnership with SKF, a leading bearing manufacturer, amplified its visibility through a whimsical yet impactful campaign: “The Faroe Islands Space Program.” By framing its kites as “moon energy” harvesters, the campaign captured millions of eyeballs, a rare feat for a niche cleantech firm. This creative approach not only boosted brand recognition but also signaled Minesto’s ability to engage both technical and mainstream audiences.

Internationally, the company’s inclusion in the Global Innovation Accelerator Program opens doors to Asian markets like Korea, Taiwan, and Indonesia—regions with significant tidal potential but limited local expertise. EU-funded programs and participation in the Osaka 2025 World Expo further cement its global strategy, leveraging its status as a European Innovation Council grantee and leader in low-flow tidal tech.

Financials: Losses, Capital Raising, and the Path to Scale

While Minesto reported an operating loss of SEK 10.7 million in Q1 2025, this reflects its aggressive investment in development and deployment. Capitalized development costs now total SEK 536 million, up from previous quarters, as the company prioritizes R&D and manufacturing readiness. A critical financial milestone was the near-complete exercise of warrants, which raised ~SEK 17.1 million. This influx, coupled with a directed share issue to investor Philip Ohlsson, bolstered cash reserves to SEK 10.3 million—a modest figure but sufficient for near-term operations.

Investors should note that Minesto’s path to profitability hinges on scaling production costs. The company’s shift to standardized assembly and reduced reliance on bespoke shipyards aims to cut expenses, a strategy that could lower the cost of energy (LCOE) for its tidal farms.

CEO’s Vision: From Dragons to Baseload Power

CEO Martin Edlund’s priorities—Dragon 12’s relaunch, Hestfjord’s permitting, and global market penetration—are all geared toward a singular goal: proving that tidal energy can deliver affordable, dispatchable baseload power. With over €45 million in EU grants and a patent portfolio worth SEK 17.5 million, Minesto is well-funded to execute its plan. Its unique position in low-flow tidal tech (effective in currents as slow as 1.6 knots) gives it an edge over competitors like Orbital Marine Power or SIMEC Zentek, which focus on higher-velocity sites.

Conclusion: A High-Risk, High-Reward Play for Cleantech Investors

Minesto’s Q1 2025 performance is a mixed bag for investors. The operating loss and modest cash reserves underscore the risks of scaling a nascent technology. However, the DNV validation, Hestfjord’s improved energy yield, and strategic partnerships represent tangible progress toward commercial viability.

Crucially, the company’s focus on standardized manufacturing and low-flow dominance could unlock a multi-billion-dollar market. The 200MW roadmap alone implies a potential revenue stream of hundreds of millions in the Faroe Islands alone, assuming a conservative $2/Watt capital cost. With Asian markets and EU grants amplifying its reach, Minesto’s story is one of high ambition—and high potential returns—for investors willing to bet on tidal energy’s long-term promise.

For now, the stock’s performance () reflects its speculative nature. But if Minesto can deliver on its Hestfjord timeline—a grid-connected 10MW farm by 2026—the company could redefine the global renewable energy landscape.