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In the application of harnessing energy from water flow, the efficiency of induction generators is difficult to actively maximize with changing mechanical loads due to its nonlinear dynamics and parameter sensitivity to environmental conditions. Along with this, the efficiencies of various turbine designs are known to be sensitive to rotational speed due to their limited high-efficiency range, which is an inherent property of rotor designs. In this work, self-tuning controls, in combination with an induction generator driven by a turbine, are used to optimally harness maximum energy from water currents. The method uses the induction generator with the appropriate rotor/turbine design and develops feedback control algorithms that adaptively tune the turbine's mechanical speed, while simultaneously maximizing the induction generator efficiency in order to actively optimize the system operation, and maximize net output power, even with changes in ocean currents and electrical load demands. A dual loop fuzzy logic control scheme maximizes both efficiencies while monitoring only the output generated node system power. A scaled 10 kW bench system, using an induction generator and a load motor with a computer controlled turbine simulator, provides experimental verification. Simulations with computer models are used to aid in the design optimization and validation.