Will wave power ever be a major source of energy in the U.S.? California with its complex cocktail of environmentalism, electricity demand, coastline, beach culture and air quality crisis will provide an interesting test case.

Vancouver-based, Finavera Renewables and Pacific Gas & Electric, the large Northern California utility, have signed a power purchase agreement for 2 megawatts of electricity that will come from a wave farm, which Finavera will build 2.5 miles off the California coast near Humboldt County. Finavera recently had postive results from a test installation of the same technology off Newport, Oregon; unfortunately the prototype sank upon retrieval, but that’s another story.

If all goes well the new farm will be operational sometime in 2012 and if successful would expand to a 100 megawatt installation. The 2 megawatt field could power somewhere around 600 homes. A 100 megawatt wave power installation would fit into a few square miles of ocean and industry experts estimate that when fully implemented wave power could ultimately contribute to about 6% of current U.S. electrical demand (EPRI).

Key issues facing wave power farms are location (they must be outside shipping and recreational areas but near a power grid or underwater powerlines), cost to construct and maintain (the sea is a harsh mistress) and return on investment (wave power is potentially cheaper to produce than wind power but more expensive than coal or natural gas). It will be interesting to see how the commercial fishing industry, recreational and environmental groups react to large wave power farms occupying once pristine, open ocean.

On the other coast, I wonder how Cape Wind’s doing?