The Welsh Government is providing £324,000 for a feasibility study into the Pembrokeshire wave energy demonstration zone.
Wave Hub is the leaseholder for the Pembrokeshire zone, which is located between 13km and 21km off the coast near the Milford Haven waterway.
The site has the potential to support the demonstration of multiple wave energy arrays with a generating capacity of up to 30MW each, WaveHub said.
The study is schedueld to start at the end of April and the findings will be known early in 2018.
Welsh Cabinet Secretary for Economy and Infrastructure Ken Skates announced the funding from the European Regional Development Fund and the Welsh government today at the Marine Energy Wales conference in Swansea.
Wave Hub managing director Claire Gibson said: “Without the Welsh government’s commitment to marine energy, our plans to develop this site would have stalled so we are extremely grateful for their support.
“This funding will now enable us to develop an outline design for the Pembrokeshire demonstration zone, begin the environmental assessment process, and engage with industry and local stakeholders to ensure our plans for the site are fit for purpose and take into account any local concerns.”
Wave Hub also operates a wave energy test site off the north Cornwall coast.