Developers have scrapped their plans to build the nation’s first large-scale wave energy project off the Oregon Coast, saying the costs were too high to make it work.

The much-anticipated project would have placed a flotilla of 100 energy-producing buoys, each the size of a school bus, in the waves off the coast of Reedsport, Ore.

The project’s developer, Ocean Power Technologies, surrendered its preliminary permit with the federal government, Oregon regulators disclosed Monday.

The project generated national headlines in the run-up to its planned launch in October, 2012. But after it delayed the deployment of its first buoy, the project seemed to be stuck on hold.

The state of Oregon last year adopted zoning rules to allow for wave and wind energy development at the Reedsport location and elsewhere in its territorial waters off the coast. But now, the area approved for the OPT wave project will become a conservation area, according to Paul Klarin, the marine program coordinator at the Oregon Department of Land Conservation and Development.

Klarin says such areas remain open to future development, though the bar is set high for companies to demonstrate that the surrounding ecological and economic resources won’t be adversely impacted.

“The larger zone that was defined in the plan for the commercial build-out will basically go away,” Klarin said.

Klarin said the company planned to develop the project amidst high-value fishing and Dungeness crabbing grounds.

Wave energy production outside Reedsport has been opposed by the Oregon Dungeness Crab Commission. Executive director Hugh Link says this is a victory for the crabbing and fishing communities he represents.

Kevin Watkins, the Pacific Northwest representative for Ocean Power Technologies, said developing wave energy and implementing it on a large scale just became too expensive and too complicated.

“The technical challenges, the operational challenges, coordinating with all the stakeholders including the state and federal agencies … it’s just taking longer than OPT had predicted,” Watkins said.

The company still plans a smaller project in the same area with 10 smaller buoys, beginning the summer of 2015.

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