Energy researchers from around the world will bid to win the £10m Saltire Prize by harnessing the power of Scotland's waters and helping establish the country at the forefront of marine energy.

First Minister Alex Salmond yesterday announced details of the challenge, to produce enough electricity to power several thousand homes over two years using tidal or wave energy, as organisers revealed that they had already received interest from as far afield as Japan, Russia, the US and Australia.

Mr Salmond said of the prize: "This might be the best £10m of expenditure Scotland has ever made."

However, as the FM revealed at Edinburgh Castle the criteria for entry, the government's record on promoting renewable energy came in for criticism, with the Saltire Prize branded too little too late by opposition parties.

The prize will be awarded to the team that creates a "commercially viable wave or tidal energy technology that achieves a minimum electrical output of 100GWh over a continuous two-year period".Bidders will have until 2013 to develop their ideas and submit their entry, and then have a further two years to create the power, with the prize awarded in 2015.

Mr Salmond said: "The £10m Saltire Prize is one of the biggest international innovation prizes in history. It is Scotland's challenge to the world."