The Prime Minister announced on Wednesday the money would go towards Tidal Stream electricity as part of its flagship renewable energy auction scheme.
It is seen as vital to take tidal stream energy to the next stage of full commercial rollout, which could allow for a range of jobs and green growth in the isles and across the country.
UK business and energy secretary Kwasi Kwarteng said: “We hope to see marine energy follow in the successful footprints of other renewable technologies, where we’ve seen costs fall dramatically in recent years thanks to UK Government support.
“The investment today provides a major push for tidal power to become a key part of the next generation of renewable electricity projects needed to strengthen energy security as we work to reduce our dependency on volatile fossil fuels.”
Scottish Secretary Alister Jack hailed the funding as “tremendous news”.
He said: “Harnessing the powers of our seas is a vital step in our transition to the use of greener, cleaner energy and underlines the UK Government’s commitment to create and protect highly-skilled jobs while on our journey to net zero by 2050.”
“With strong wind and solar power industries in the UK, it is the natural next step to explore our tidal energy capabilities. It’s an exciting development in supporting of our domestically-produced renewable energy sources.”
However, the SNP have now criticised the ring-fenced funding, claiming it should have been £71m.
The party’s Westminster leader Ian Blackford said: "Tidal has the potential to be a major Scottish success story and a key part of Scotland's renewable energy revolution, but it can only properly flourish if the UK Government delivers the scale of funding required.
"The Chancellor must increase the budget to at least £71m so world-leading Scottish companies aren't restricted in their ambitions.
"This change of heart must also mark the beginning of a series of U-turns for the UK Government – and next up must be an urgent U-turn on the decision to cancel investment in Scotland's carbon capture project."
However, Lib Dem MP Alistair Carmichael welcomed the plans, with the commitment coming after a cross-party letter to the Prime Minister earlier this month.
The Orkney and Shetland MP said: “This is excellent news and a testament to the tireless campaign by so many people to get the government on side.
“This is a success that has been years in the making and has the potential to set up tidal stream energy commercialisation – with green growth and jobs in the isles and across the UK – for the years to come."
The Department of Business said £20m per year ring-fenced for Tidal Stream projects will bring the total funding for renewables to £285m a year.
They said in a statement this would give the marine energy sector a chance to develop technology as well as lower costs in a similar way to the offshore wind industry.