Under the proposals, several large turbines would be fitted to the sea floor off the coast of Pembrokeshire to generate enough energy to power 5,000 homes in the area.
Plans for the project, which has been designed in conjunction with Lunar Energy, have been submitted to the Department for Business, Enterprise and Regulatory Reform (BERR) for approval.
Commenting on the proposals, E.ON UK's marine development manager Amaan Lafayette said: "If we are to succeed in the battle to combat global warming, we must look at a wide range of technologies to reduce our carbon emissions".
"If it gets the go ahead, this scheme will be one of the largest tidal stream projects of its kind in the world, and represents a fantastic opportunity to establish Wales as a global leader in marine energy development."
E.ON also showed its commitment to renewable energy causes earlier this week by launching a new business electricity product which offers clients a 100 per cent renewable service.
Click here to run an energy price comparison, and see if you could be paying less for your gas and electricity.