It was part of a £7.9m parcel of grants given to companies developing wind and tidal energy technology as the Scottish Government strives to achieve its target of meeting 100% of Scotland's energy needs from renewable sources by 2020.
Glasgow-based Nautricity's grant will go towards the £4.9m cost of deploying its CoRMaT tidal current turbine south of Machrihanish next summer. Testing is expected to be completed by March 2014 with commercial deployment "soon after".
Nautricity's device is capable of generating 500 kilowatts of electricity and is tethered to a sub-surface float.
Among the other recipients was Orkney-based Scotrenewables Tidal Power which received £1.2m towards a £9.2m project.
Edinburgh-based wave energy specialist AlbaTERN was given £617,000.
Inverness's AWS Ocean Energy received £3.9m.
Tyne and Wear tidal energy firm Oceanflow Development got a £750,000 grant.