United States of America

Supporting Policies for Ocean Energy

NATIONAL STRATEGY

National Ocean Energy Policy
Members of the U.S. House of Representatives from districts along the U.S. West Coast introduced the Marine Energy Technology Acceleration Act in 2024 that could allow for up to $1 billion in funding to advance marine energy. The bill’s future is uncertain, but if passed, it could substantially increase public funding disbursement by WPTO’s Marine Energy Program. Additionally, other representatives from the U.S. West Coast introduced the Blue Ocean Energy Innovation Act in 2024, which aims to fund research and development (R&D) of renewable energy technologies and greenhouse gas capture and removal technologies located in aquatic environments. 

The National Hydropower Association’s Marine Energy Council (MEC), the U.S. trade group representing marine energy, released a position paper in July 2024 denoting updated priorities and recommendations to advance marine energy in the Unites States. The MEC engages in national- and state-level policy discussions and initially published a commercialization strategy in 2021. 

On the state level, California made progress toward the aims of its marine energy bill (California Senate Bill 605) that passed in 2023. The California Energy Commission held a public workshop and sponsored a report to assess feasibility, costs, and benefits of using wave and tidal energy in the state. The report concluded that the state’s promising wave and tidal energy resource potential and existing clean energy policies indicate a supportive environment for research, development, testing, and eventual installation of marine energy technologies in an environmentally responsible manner. The report also identified a need for specialized workforce training programs and local manufacturing capabilities for advancing the marine energy sector.

Following the release of the Ocean Climate Action Plan in 2023, the White House issued a one-year progress report in 2024. The report mentions WPTO’s marine energy public funding opportunities as contributing to one of the plan’s major goals to create a carbon-neutral future.


MARKET INCENTIVES

The Inflation Reduction Act of 2022 (IRA) included clean energy production and investment tax credits applicable to marine and hydrokinetic technologies. Since passage of the law, the U.S. government has released final rules on several tax credits created or extended by the IRA. 

For example, in December 2024, the government released final rules for the Investment Tax Credit, also known as the Section 48 Energy Credit, which supports capital investment in renewable energy projects beginning construction before 2025. 

In 2025, the Investment Tax Credit—and the closely related Production Tax Credit—will be replaced by a technology-neutral approach with credits that will be available in full for projects beginning construction at least through 2033. In January 2025, the government released final rules for these Clean Electricity Production and Investment Tax Credits, also known as technology-neutral credits. These credits provide incentives for companies to invest in clean energy technologies and eliminate the need for recurring legislative tax credit extensions, providing clean energy project developers clarity and certainty to undertake major investments. The final rules clarify which zero-emissions clean electricity technologies qualify for the credits, including marine and hydrokinetic technologies. 

The energy-related tax rules were developed by the U.S. Department of the Treasury and the Internal Revenue Service in consultation with the U.S. Department of Energy. WPTO maintains an updated webpage summarizing tax incentives for water power technologies.


PUBLIC FUNDING PROGRAMS

DOE is the primary distributor of national-level public funding for marine energy in the United States. Agencies such as the Department of Defense (DOD) and National Science Foundation (NSF) also fund and support marine energy research, development, and demonstration.

Within DOE, WPTO’s Marine Energy Program is the United States’ primary public funder of marine energy R&D and had a $141 million budget for Fiscal Year 2024 (October 2023 to September 2024), the largest since the program began. This budget included $21 million for facilities upgrades at PNNL’s Marine and Coastal Research Laboratory. As of January 2025, Congress had not passed a final Fiscal Year 2025 budget, and government agencies were being funded by a temporary funding bill. In addition to annual appropriations, the Infrastructure Investment and Jobs Act enacted in 2021, known as the Bipartisan Infrastructure Law (BIL), provided $110.4 million to WPTO for marine energy activities and the office continued disbursing these funds in 2024. 

In 2024, WPTO’s marine energy funding and technical assistance programs included notable opportunities for businesses, developers, universities, and students. 

For businesses and developers, in September 2024, WPTO opened the “Oceans of Opportunity” funding opportunity, which will provide up to $112.5 million for wave energy development and testing over five years, representing the largest U.S. investment in wave energy to date. The opportunity aims to advance commercial adoption of wave energy technologies by reducing financial risks for developers, identifying and maturing promising technologies, and facilitating open water testing that can provide data and lessons for the industry. Three topic areas focus on different sizes and uses of wave energy: distributed, community, and utility applications. Selections for the first stage of funding are expected to be announced in summer 2025. 

In February 2024, WPTO announced two projects selected to receive a combined $6 million for tidal energy research, development, and demonstration projects and another project to receive $9.5 million for a community-led river current energy R&D project. In 2025, one of the tidal energy projects is expected to be selected to receive an additional $29 million to proceed to the next phases with the ultimate goal of testing and operation. 

WPTO continued to support small businesses in 2024 through the Small Business Innovation Research (SBIR) program. Sixteen projects received a combined $11 million to either begin or continue work on various projects related to marine energy components and subsystems, co-development with blue economy end users, emerging sensors and monitoring technologies, and more. WPTO also opened a funding opportunity for organizations to develop or augment incubator and accelerator programs that will help small businesses advance their water power technologies. Eight projects were selected in January 2025, receiving $100,000 each for their initial planning phase. 

Additionally, 14 projects were selected to receive nearly $17 million to further support durable and environmentally responsible U.S. offshore wind energy and marine energy deployments. Among other efforts, these projects include research for technology advancements to improve the integrity of mooring systems for marine energy converters and offshore wind energy platforms. WPTO, DOE’s Wind Energy Technologies Office (WETO), and the Department of the Interior’s Bureau of Ocean Energy Management and Bureau of Safety and Environmental Enforcement jointly funded this opportunity. 

To complement funding awards, WPTO sponsors the Testing Expertise and Access for Marine Energy Research (TEAMER) program, which is run by the nonprofit Pacific Ocean Energy Trust. Developers can apply to TEAMER for technical support provided by expert researchers and state-of-the-art facilities. Support can range from numerical modeling to tank testing to open water testing. TEAMER selected more than 50 projects in 2024 and increased project budget caps for technical support and testing. Both U.S. and non-U.S. developers are eligible to apply to TEAMER.  

For universities, WPTO, working with WETO, announced the selection of 27 projects in a more than $18 million funding opportunity focused on marine energy and offshore wind R&D in the academic sector. Projects will focus on data and test platforms, co-development with aquaculture, undergraduate senior design or research, and many other novel concepts. 

More than $41 million was also provided to the university-led National Marine Energy Centers for new and continuing R&D projects and testing infrastructure improvements over the next five years. Additionally, WPTO funded three marine energy projects through a seed funding initiative to support research at minority-serving colleges and universities.  

WPTO also sponsors opportunities directly aimed at undergraduate and graduate students, helping to build the future marine energy workforce. One of these is the annual Marine Energy Collegiate Competition (MECC), where interdisciplinary teams of students design marine energy solutions for powering ocean economy activities. In 2024, the University of New Hampshire won first place in the fifth annual competition, and WPTO announced the 23 teams selected to compete in 2025. Another student opportunity is the Marine Energy Fellowship Program, which awarded five graduate students in 2024 the opportunity to work alongside a host institution on research that contributes to their dissertation. The program was expanded for the upcoming fellowship year in 2025, offering an additional post-graduate track for students who graduated within the last two years and switching to two application periods per year for greater flexibility in start dates. 

DOE’s national laboratories also receive public funding to perform marine energy R&D. In 2024, DOE national laboratories were awarded about $18 million from WPTO across 40 new or continuing marine energy R&D projects. Projects span topics such as molecular methods of environmental monitoring, tools to generate wave energy equations of motion, ocean thermal energy conversion and seawater air conditioning assessments, and modeling marine energy integration with activities like ocean observation and marine carbon dioxide removal. Through DOE’s Office of Technology Transitions (OTT) funding opportunities and training programs, WPTO also sponsors national laboratory projects focused on customer discovery and technology readiness. In 2024, seven marine energy projects were selected through OTT programs, such as one focused on a piezoelectric technology technoeconomic assessment and another focused on hydrophone flow shields. 

More broadly, WPTO-sponsored marine energy prizes are open to the public and solicit innovative concepts to solve specific challenges. In 2024, the Innovating Distributed Embedded Energy Prize selected 15 winning teams for Phase 2, each receiving $80,000. Competitors are developing distributed embedded energy converter prototypes with an emphasis on interdisciplinary collaboration. Phase 3 of this prize closes in early 2025. The Power at Sea Prize announced 20 winners in its first phase, each receiving $10,000. This prize seeks innovative marine energy solutions that could power ocean economy activities, with winning teams proposing diverse applications ranging from aquaculture to autonomous underwater vehicles to artificial reef integration. The next and last phase of the prize will close in summer 2025.

Other DOE offices, including the Office of Clean Energy Demonstrations and Loan Programs Office, provide funding for post-R&D stage projects. Marine energy projects are typically eligible for these opportunities, though none have been funded yet. DOE’s Advanced Research Projects Agency-Energy (ARPA-E) continues to fund marine energy R&D projects through its Submarine Hydrokinetic And Riverine Kilo-megawatt Systems (SHARKS) program.

Outside of DOE, NSF funded several university-led marine energy projects in 2024 as well as a business-led project through its own SBIR program. For example, a group of interdisciplinary researchers across multiple universities received $3.6 million to design wave energy solutions for community-identified needs at two coastal locations in the United States. 

Some U.S. states, such as Alaska and Washington, also have their own public funding programs for energy projects inclusive of marine energy. For example, in 2024, wave energy developer Oscilla Power was selected for a grant through Washington’s Department of Commerce, funded by the state’s Climate Commitment Act. The funding will support Oscilla’s continued development of its 1 MW Triton wave energy converter (WEC) drivetrain technology.

Consenting processes

MARINE SPATIAL PLANNING POLICY
At the national level, there is no existing marine spatial planning policy for ocean energy.

On June 19th, 2018, the President signed Executive Order 13840 entitled “Ocean Policy to Advance the Economic, Security, and Environmental Interests of the United States”. The new EO revokes Executive Order 13547 (Stewardship of the Ocean, Our Coasts, and the Great Lakes) of 2010 and in its place, emphasizes a new ocean policy and accompanying processes to advance the economy, national security, and environmental interests of the U.S. The new ocean policy does not explicitly mention Marine Spatial Planning (MSP) or prioritize its inclusion for Federal engagement with ocean matters. State and Regional Ocean Partnerships will engage in MSP and issue marine spatial plans as decided by the individual states or through other regional mechanisms such as regional ocean partnerships.

Previously, the Final Recommendations of the Interagency Ocean Policy Task Force, Executive Order 13457, and the Nation Ocean Policy Implementation Plan (Appendix Milestones) established and supported MSP at a regional level. The United States and its territories were divided into nine Regional Planning Bodies (RPBs). As of 2018, some RPBS have formed and are at various stages of the marine planning process (e.g. the Mid-Atlantic RPB and the Northeast). The new executive order calls for the establishment of an Ocean Policy Committee (OPC) to replace the previous structure of the RPBs and the National Ocean Council (NOC). However, the new OPC has a similar mandate to the prior NOC and specific to Marine Spatial Planning the new EO encourages the OPC to work with stakeholders, including regional ocean partnerships, to assist when matters that may require interagency or intergovernmental solutions arise.

Several states in the United State have developed and implemented their own marine plans. Some existing plans were initiated before the release of the National Ocean Policy, and in 2018 Washington State adopted a Marine Spatial Plan for their Pacific Coast; other states are considering similar actions.

Pre-selected areas for ocean energy development have not been defined on a national level, though State Task Forces led by the Department of Interior and the Bureau of Ocean Energy Management (BOEM) have identified and set aside initial areas for the development of offshore wind. A number of states have also identified selected areas for ocean energy development (e.g. Rhode Island, Massachusetts and Oregon). Areas identified through spatial planning and pre-selected processes have typically involved collaborative processes including multiple stakeholder groups.

AUTHORITIES INVOLVED
The authorities involved in the consenting process are:

• The Federal Energy Regulatory Commission (FERC) – It has jurisdiction over marine and hydrokinetic facilities in navigable waters that are connected to the grid;
• The Bureau of Ocean Energy Management (BOEM) – It has the authority to issue leases and easements for hydrokinetic projects located partially or entirely on the Outer Continental Shelf (OCS);
• The U.S. Army Corps of Engineers (COE) – It issues permits for any structure placed in navigable waters. It has jurisdiction over marine and hydrokinetic facilities in navigable waters that are not connected to the grid;
• The U.S. Coast Guard (USGS) – it issues permits to mark all obstructions in navigable waters with navigation aids to ensure that projects do not interfere with established shipping lanes

Multiple other federal and state agencies are consulted during the permitting process to ensure that projects comply with a number of federal and state environmental protection statutes. These agencies include but are not limited to: the National Oceanic and Atmospheric Administration (specifically the National Marine Fisheries Service within NOAA), the U.S. Fish and Wildlife Service, the Environmental Protection Agency and the National Parks Service.

CONSENTING PROCESS
This handbook is currently being updated and is scheduled to be released in late 2018. The sequential steps are dependent upon the location of the project and whether the project will be connected to the grid. FERC allows prospective developers to apply for a preliminary permit, which gives the developer first rights for the development of a specific site, but it is not required to obtain a FERC pilot or commercial license. There are five different scenarios (including best-case scenario timelines) in which different permits and licenses are necessary:

Scenario 1 – Non-grid connected pilot project in state waters – 12 months;
Scenario 2 – Grid connected pilot project in state waters – 12 months;
Scenario 3 – Commercial scale project in state waters – 4 years or more;
Scenario 4 – Any project on the OCS, non-competitive lease process – 3 years or more;
Scenario 5 – Any project on the OCS, competitive lease process – 6-8 years.

The length of the permitting process is dependent upon the type and location of the project, especially if the project is located in a sensitive area. In practice, very few MHK projects have completed the entire permitting process in the U.S., and the majority have exceeded these timeframes.

There is no single agency (“one stop shop” facility or entity) that is responsible for the entire ocean energy permitting process. FERC and BOEM are the two agencies with overarching authority over licensing and leasing activities in the U.S. The lead agency is dependent upon the location of the project and whether it will be connected to the grid. Multiple state agencies are also involved in the permitting process. For all projects located on the OCS (generally 3 nautical miles from shore to the exclusive economic zone boundary) BOEM must issue a least that allows the developer access to the site and FERC must issue a license for the project to move forward.

ENVIRONMENTAL IMPACT ASSESSMENT
A National Environmental Policy Act (NEPA) analysis is always required prior to any action taken by a federal agency.

NEPA was enacted to ensure that federal agencies evaluate potential environmental impacts of any proposed action and reasonable alternatives. As a result of an initial scoping process, the project either receives a Categorical Exclusion (CX), and Environmental Assessment (EA) or an Environmental Impact Statement (EIS).

The results of the NEPA analysis and multiple consultations that occur before leases and licenses are issued are often used to generate monitoring or mitigation requirements that must be implemented as a condition of the license. The FERC pilot project guidance places large emphasis on post-deployment environmental monitoring while the standard commercial licensing process places a larger emphasis on environmental studies conducted before the license application is filed.

LEGISLATION AND REGULATION
The Energy Independence and Security Act of 2007 directed the Department of Energy to work with the Department of the Interior and Department of Commerce to develop a program to support research and demonstration and commercial application to expand the use of marine renewable energy sources. It also allowed for the establishment of the National Marine Renewable Energy Centers. There is no regulatory authority conveyed by this Act.

FERC carries out its regulatory authority under the Federal Power Act. In 2008 FERC developed a Guidance for Pilot Project Licensing to speed up the licensing process for demonstration projects. BOEM has also developed a set of regulations governing its OCS Renewable Energy Program.

The Energy Policy Act of 2005 provided guidance for federal regulation of new renewable energy technologies in general and amended the OCS Lands Act to give the Secretary of the Interior the authority to regulate the production, transportation or transmission of renewable energy on the OCS. This authority was delegated to BOEM. Essentially, the Energy Policy Act conferred regulatory authority for hydrokinetics to both FERC and the Department of the Interior (DOI), but the law did not clearly specify the scope of each agency’s jurisdiction. To remedy this, the FERC and the DOI signed a Memorandum of Understanding (MOU) in 2009 clarifying the scope of each agency’s respective responsibilities for regulating renewable energy projects on the OCS.

Executive Order 13514 “Federal Leadership in Environmental, Energy and Economic Performance” called for the increased use of renewable energy by federal agencies and aligning federal policies to increase the effectiveness of local planning for locally generated renewable energy.

Plans for changing legal and administrative frameworks to facilitate development and more integrated marine governance: The Marine and Hydrokinetic Renewable Energy Act of 2013 proposed to amend the Energy Independence and Security Act of 2007. This act has been introduced to the U.S. Senate but has not received legislative or executive approval.

CONSULTATION
Consultation with various stakeholders and regulators is performed at multiple stages of the process.

Stakeholder consultation stars at the very beginning of project development, and public comment periods are incorporated into each of the regulatory stages. In order to receive a FERC license or a BOEM lease, a series of mandatory consultation are performed, usually in conjunction with the NEPA analysis.

GUIDANCE AND ADVICE
Various reference materials are available to developers to provide additional details on the licensing process. These include FERC’s “Handbook for Hydroelectric Project Licensing”, “Hydrokinetic Pilot Project Criteria and Draft Application Checklist” provided by FERC, and the “Handbook of Hydrokinetic Regulatory Processes”.

TEST CENTERS
The PacWave test site, to be built off the coast of Oregon, will generally be pre-permitted for most types of wave energy converters. However, there may still be additional regulatory processes or consultation needed prior to testing, particularly if the testing is supported by federal funds, which would require a NEPA analysis. Data collected at the site could also be shared to help accelerate the process for permitting in general.