Federal Court proceedings are delaying the removal of a 3,000-tonne wave energy generator that sank off the coast of Carrickalinga, south of Adelaide, more than three years ago, the State Government has said.

This is despite its promises at the time that the structure would be removed from the coastline within a year.

The Oceanlinx structure was being towed from Port Adelaide to Port McDonnell in March 2014 where it would have used oscillating water column technology to generate enough energy to power about 1,000 homes from shallow waters.

Instead it started listing after its airbags were damaged and the unit sank while being towed to shallow water.

Shortly afterwards, Oceanlinx, which previously had a generator sink offshore at Port Kembla in New South Wales after it broke free from its pylons during rough seas in 2010, went into receivership.

An SA Department of Planning, Transport and Infrastructure (DPTI) spokeswoman said the Government had obtained plans from several maritime contractors for the Carrickalinga unit's removal.

"These plans, however, are on hold until finalisation of Federal Court proceedings," she said.

A spokesman for Oceanlinx liquidator and Deloitte Restructuring Services partner Vaughan Strawbridge said the proceedings involved a creditor seeking priority access to funds the liquidator held.

He said court proceedings were not delaying any action to remove the generator and instead related to a creditor, "not the ability of government, or anyone else, to do something about the unit".

He said there were insufficient funds in the company to allow for the "remediation or removal of the wave generator", which meant the liquidator has had to "disclaim all rights to the unit".

"The South Australian Government and anyone else who has an interest in the unit has been put on notice of this," the spokesman said.

"As far as any costs are concerned, the Government will be able to make a claim in the liquidation alongside other creditors."

He said NSW Maritime was dealing with the generator at Port Kembla. The ABC understands it is in the process of being removed.

The Oceanlinx generator off Port Kembla in NSW is reportedly being removed by the NSW Government. ( Supplied: Adam McLean, Illawarra Mercury. )

Local residents frustrated by lack of action

Residents were told by the DPTI in April 2014 it would help receivers remove the $7 million structure within the year.

"Ever since that time, [the] council are regularly asked by residents if we know any more than they do and when it is going to be gone," District Council of Yankalilla chief executive Nigel Morris said.

The wave energy generator started sinking while it was being towed to Port MacDonnell.

Many people consider the generator an eyesore and Mr Morris said visitors and ratepayers were eager to "return the coastline to its pristine condition".

"It is frustrating that after this length of time, we don't know what is going to happen to the wave generator and a timetable for when it is going to occur."

An exclusion zone remains set up around the site at Carrickalinga.

The DPTI spokeswoman said the zone would remain in place because the generator "in its current form may pose a safety risk to anyone on or near the unit".

"DEWNR [Environment, Water and Natural Resources department] has visited the site several times. There are no concerns of serious or significant environmental impact," she said.

Yankalilla Deputy mayor Janet Jones said the unit had been there so long it was probably acting as a "marine reef or fish hideaway", with boats unable to get close to it.

"I do tend to think that those who are responsible for it ending up there, really should take the responsibility to remove it," she said.