Waves constantly thrash the tiny fishing village of Mutriku on Spain's northern Basque coast. Tax logs as far back as the 13th century describe dangerous surf and shipwrecks. Water even hurled debris through the windows of homes before the local government built a cement breakwater a few years ago.

Today, residents can stroll down a pier and out over the breakwater, which is a hollow cement and stone structure more than four football fields long. Hidden inside, Spanish scientists are busy generating electricity from the powerful waves that roll in off the Bay of Biscay.

Gloria Etxebarria is a renewable energy technician specialized in electricity generated from tides or waves. "The government decided to build a breakwater to protect the harbor of Mutriku," she said in an interview with DW. "To make use of that investment, we decided to put our wave energy plant there."

Marine power

Spain is exploring the relatively young wave power industry after investing heavily in solar and wind power for decades. Every wave that rolls into the Mutriku wave plant sets 16 turbines spinning with the help of oscillating water columns (OWC) technology.

"We have some chambers and when the wave arrives, it pushes, compresses the air inside the chambers," Etxebarria explained. "So the air goes through a turbine, which in turn drives an alternator, producing electricity."

The breakwater houses the power plant

Salt water would quickly corrode the turbines, requiring expensive repairs. But the water never touches them. Instead, the turbines turn only with the force of air pressure, created by the waves pushing up underneath them.

The Mutriku plant connected its turbines to Spain's power grid in July 2011, making it Europe's first commercial wave plant. Since then, similar technology has been used in Scotland and the Azores.

The plant has a capacity of about 300 kilowatts, which is enough to supply constant power to about 600 residents. It cost the regional government about 2 million euros ($2.5 million) to build.

Untapped global potential

The capacity here is very small compared to Spain's wind and solar output, which can generate up to 70 percent of the country's electricity when the weather is favorable. But just like the country's notorious construction bubble, Spain had a renewable energy bubble that popped when Spanish lawmakers slashed the budget last year.

This display explains how Mutriku's turbines work

The government decreed a moratorium on renewable energy, explained Gonzalo Escribano, an energy economist at Madrid's Elcano Royal Institute. "Moratorium means no new installations will receive support. That's it."

During Spain's economic boom, the government offered generous subsidies for renewable energy. But those days are long gone. Large, expensive solar plants are not as attractive as small-scale experimental projects like the Mutriku wave plant.

But Spain's ongoing economic crisis could mean a blossoming of different types of renewable energy, now that subsidies for wind and solar are gone. "You've got a lot of energy sources, and you will need all of them. You will need conventional and you will need new energies," Escribano told DW. "So you have to pursue all the paths."

Expanding renewables

Experts estimate that it took about 30 years of generous government subsidies for Spain's wind energy industry to get close to being competitive with natural gas. It could take decades for wave power to establish itself as the industry is still in its infancy.

Meanwhile, Spain is desperately searching for an industry to replace all the jobs lost when the construction sector collapsed. Unemployment has topped 25 percent. Renewable energy may be a solution, though the industry currently employs much fewer people and requires more expensive, high-tech equipment than construction.

Power for hundreds of households

"Construction is low-capital intensive, with a high number of jobs. Renewable energy is capital intensive and investment intensive," explained Juan Goicolea, deputy Minister of Innovation and Technology for the Basque regional government, which overseas the Mutriku wave plant.

"But in the end, renewable energy investment creates added value that will be recycled through other activities that will create jobs," Goicolea said.

In fact, the renewable sector hopes to create more than 200,000 green jobs in Spain this year and as many as three million across Europe.