Ocean Renewable Power Company, Inc. (ORPC) recently completed an EU Horizon 2020 funded project to develop and test a “wet-gap” generator for use with their tidal and river energy converters. This wet-gap system is designed for a normal operating condition of a seawater flooded electrical generator which would typically be air or oil filled. This development removes the need for insulating oil in the generator casing and the need for rotary seals and oil compensation for the casing of the generator. Results from small- and full-scale testing show the chosen encapsulation method to have performed within the requirements set. As such, this innovation has both economic and environmental benefits and is the first of its kind in marine hydrokinetics.