Newport, Oregon – Oregon State University’s $80 million PacWave South, the world’s largest-capacity wave energy testing facility, has completed construction this spring after more than a decade of development. Located seven miles off the central Oregon Coast, the facility is designed to allow wave energy developers to test prototypes in the open ocean and transmit generated electricity to the grid. However, the operational future of PacWave faces significant uncertainty due to recent federal funding cuts and delays in renewable energy research and technology development.

This funding instability has already impacted key players, with at least one wave energy developer, AquaHarmonics, canceling its planned deployment at PacWave after losing an approved federal grant. Alex Hagmüller, CEO of Oregon-based AquaHarmonics, confirmed the company began laying off staff on June 30, 2025, stating their previously approved federal grant funding was not released, effectively derailing their plans to be among the first to test a device at PacWave.

Oregon is uniquely positioned for wave energy, described by PacWave Chief Scientist Burke Hales as a “Goldilocks” climate due to its optimal wave conditions, existing coastal infrastructure, and port access. The PacWave facility, a two-by-one nautical mile rectangle divided into four testing areas, is poised to host cable-connected device deployments as early as summer 2026. Yet, this timeline is now uncertain, as Hales noted, due to “political and federal upheaval.”

The Department of Energy’s Water Power Technologies Office, a primary funder for wave energy technology, anticipates a 20% budget cut in the upcoming fiscal year. This reduction is part of broader federal grant cancellations and delays under the current administration, which directly impede the progress of early-stage technologies like wave energy.

Wave energy technology, despite concepts existing for over half a century, remains in its infancy compared to established renewables like solar and wind. The U.S. government only began significant policy and funding consideration for wave energy in the last two decades. PacWave Director Dan Hellin emphasized that such technological development “needs that driving force” of federal funding. The facility’s existence significantly reduces the financial and bureaucratic burden on developers, allowing them to focus on device innovation rather than site development.

Off Oregon’s coast alone, the available wave energy is estimated to be sufficient to power 6.4 million homes, exceeding the combined homes in Oregon and Washington. This vast, untapped resource offers a consistent energy source, complementing intermittent solar and wind power. However, the diversity of wave energy converter designs and the harsh marine environment present unique engineering challenges. Sarah Henkel, interim director of the Pacific Marine Energy Center, highlighted the lack of a standardized design, unlike wind turbines, making iterative testing crucial.

AquaHarmonics’ experience underscores the industry’s vulnerability to funding fluctuations. Their mid-size prototype, designed to power remote sensors and high-speed internet, now sits untested. Hagmüller stressed the paramount importance of facilities like PacWave for engineers to “iterate and fail fast,” a necessity for industry advancement that is currently hampered by funding uncertainties.