The 10-year power purchase agreement (PPA) agreement with the project’s developer Atlantis Resources could be worth over £50m in its lifetime.
The deal will offer revenues from power generated and exported to the grid under the first four-turbine, 6MW phase of the project through to 2025.
It also includes additional benefits paid to renewable generators including five Renewable Obligation Certificates per megawatt-hour.
MeyGen chief executive Dan Pearson said: "This is an important step forward for MeyGen and its backers. The agreement with SmartestEnergy will secure the long-term revenues which will demonstrate the commercial viability of the project and also highlight the wider potential of tidal stream generation to become a significant industry."
SmartestEnergy Glasgow-based generation sales manager Iain Robertson said: "This is a landmark deal for the marine renewables sector in Scotland and underlines the commercial potential of the industry that developers are now starting to exploit."
Atlantis has recently secured a £50m funding package for the project from a range of backers, including the Scottish government, Highlands and Islands Enterprise, the UK government and the Crown Estate.
Construction of phase one is expected to start later in 2014 with the first power planned to be delivered to the grid by 2016.
The first phase of the project is expected to generate about 86MW of electricity, enough to meet the energy needs of about 42,000 homes.
Swiss power technology firm ABB will provide the onshore grid connection for the phase one of the project.
Image: The first phase of the MeyGen tidal stream project is expected to generate about 86MW of electricity. Photo: Courtesy of SmartestEnergy Ltd.
