Verdant Power of New York has started installing the final five devices in its first fleet of underwater power turbines in New York's East River.

It's an auspicious milestone in the small company's nine-year upstream swim against the currents of both nature and regulators. And it puts the company on a path to be among the first in the U.S. to produce utility-scale power from tidal energy.

If you've been following tidal power, you may have heard of Verdant's work in the East River—which is actually less a river and more a tidal strait that connects Long Island Sound with the Atlantic Ocean. Being subject to tides, the current reverses with the tide, creating challenges for equipment designers.

It took four prototypes of four different approaches, but Verdant feels it now has a winner with a three bladed axial flow rotor turbine, which boasts a special wing at the front to turn its rear-mounted, or downstream, blades into the current, whichever way it's coming from.

"The wind industry never took off until all the technologies industry converged on three bladed upstream axial flow turbines. I think that's one of our great differentiations versus competitors," said Trey Taylor, co-founder and president of Verdant Energy, to the Cleantech Group.

"There are a lot of people out there, with a lot of ideas. But very few have a working product, let alone one that's on a path to commercialization," Taylor said.

In the U.S., there is no federal ocean energy program. The U.S. Department of Energy did an assessment of ocean energy potential in the early 1990s after investing around $250 million, nearly all in ocean thermal energy technologies. It concluded the oceans' electricity contribution would be small and geographically localized (only a handful of U.S. states have good waves or tidal flows) and the return on investment would be marginal compared to wind or solar.

Companies like Verdant have, therefore, explored ways to tap the kinetic energy present wherever water is flowing, for instance in rivers or even existing man-made channels. The company is not in the business of having to rely on dams, pipes or large civil works projects, it says.

While Verdant likes to claim it was the first to deploy turbines into the water, actually delivering electric power to customers, its first turbines in the East River to date had apparently been singular—one, admits Verdant's Taylor—although he told the Cleantech Group "the remaining five turbines are actually going into the water as we speak."

The initial turbine has been powering a supermarket in Manhattan and a parking garage, where electric vehicles can plug in to tidal power, said Taylor.

Verdant's East River turbines are 16 feet in diameter, mounted on monopiles and are completely hidden a dozen or more feet below the waterline. The company notes other blade diameters are possible, driving the turbine at differing speeds, depending on application.

The first turbine has only been producing 35 kW of power. The remaining turbines now being installed are to bring the array's total to 175 kW (5x35.) A sixth turbine will contain instrumentation for monitoring the array and nearby marine life.

"We've invested more than $2m in ultrasonic equipment to gather evidence of safe fish passage through the turbines," said Taylor, noting the blades of Verdant's turbines rotate much slower than those of wind turbines.

While it's been working for years on the East River installation, Verdant faces at least another 18 months of operational tests before it can seek a FERC license to build as much as 10 MW of installed capacity at the site. Taylor called the regulatory process in the U.S. onerous.

"It's been tough. There's a lot of competing agencies for water when it comes to doing things in waterways. You have environmental agencies, resource agencies, concerns about fish passages, water quality, concerns about shipping and navigation. A lot of issues have to be addressed."

Since starting in 1998, Verdant has been funded from its own deep pockets, selected angel investors and Tudor Investment, which invested $7.5m in the company last August and is has committed to another $7.5m next month. Verdant is currently looking at a term sheet with Keyspan Energy for project financing, according to Taylor.

There are other companies pursuing wave power (such as Ocean Power Delivery [1], Finavera [2] and SyncWave [3]). Verdant characterizes its direct competitors in tidal power as Lunar Energy, Marine Current Turbines and OpenHydro, all of the U.K., and all of which are pursuing larger turbines intended for deeper water, where the costs and challenges of installation are higher.

"From a business point of view, by starting smaller, closer to load pockets, it's been easier for us to get under way. Our learning curve can be faster," said Taylor. "Our approach is at one end, theirs is the other. But in the future, we might all meet in the middle."