The Subsea Power Hub (SPH) is being tested by Aberdeen based EC-OG at Shapinsay Sound, Orkney.
The company said the system is "performing in line with technical predictions".
The unit will be left to operate autonomously over the summer months while it is checked using wireless data monitoring.
EC-OG said the SPH is a ground-breaking hybrid drive system which uses a marine energy convertor to produce energy which is stored in a lithium-based unit.
Engineering director Robert Cowman said: "Although the weather was not on our side, we were still able to successfully complete the installation and commence testing ahead of schedule.
"The system is performing very well and I'm pleased at how quickly the results are correlating with the theoretical basis for the test. Having a vertical axis turbine, means that the SPH is operating effectively in these unpredictable, sporadic flow conditions.
"Thanks go to the EC-OG team as well as those who have helped us at EMEC, Leask Marine, Castle View and Scottish Enterprise."

The undefeated pair have exchanged obscenities on social media in the run-up to their so-called "Bad Blood" title contest at Braehead Arena on 8 July.
But Londoner Davies, 25, played down the hostility that continued at their media conference in Glasgow this week.
"He's been told to sell the fight. I don't blame him for any of his antics," said the WBC Silver title holder.
"I'm a cool guy. I believe that you live and you learn. I've been wild but now it's just about going to the gym, enjoying camp, enjoying the fight night. This isn't nothing, really. It's just business for me.
"Social media is good to sell the fight. I'm not trying to sell the fight, I'm just trying to be me.
"I was a lot more arrogant in my last fight. For this fight I'm in a whole different mood."
Davies refused to react to the four-letter taunts from Commonwealth champion Taylor, 26, when they came face to face in a Glasgow hotel to promote next month's bout.
At one point, Shane McGuigan-trained Taylor tried to remove Davies' sunglasses and the East Lothian fighter later told BBC Scotland he could "detect fear" in the Englishman's eyes.
However, Davies played it down at the event, though reverted to online abuse later in the day.
"I know that's not him," said Davies, who is trained by Tony Sims.
"I know that he's been told to sell the fight and all that stuff, taking off my glasses and trying to provoke me. If I really got to know him, he'll be a cool guy. I'm not going to be angry.
"I make of him what I've always made of him. He's a good fighter and on 8 July, we're going to have a good fight.
"This definitely will be my toughest fight so far - well, I hope it is. My past two fights, I found them quite easy and I want a real challenge. I want to go in there with someone that's got the capabilities of beating me. That's what we're in the game for."
Davies defeated Italy's Andrea Scarpa over 12 rounds at Wembley last November to win the WBC Silver belt and in March took three rounds to dispose of Derry Mathews, again in London.
A new ocean current energy system has been successfully deployed, according to the company behind it.
[NEXT_CONCEPT]
Super-lightweight Ohara Davies feels Josh Taylor is acting out of character with his abusive comments towards him.