The Government has announced it will take over the Westcountry’s Wave Hub, ending speculation on the future of the world’s largest commercial wave energy terminal.

The offshore marine energy scheme, which sits in Cornish waters, was the brainchild of the South West Regional Development Agency, the quango being wound down ahead of being abolished in April.

It was revealed yesterday Wave Hub, which is set to be operational from the start of 2013, will now come under the wing of Vince Cable’s Department for Business Innovation and Skills in January.

Against fears the project would be managed by bureaucrats based in Whitehall, the department has created a stand-alone company located in Hayle to run the project day-to-day.

Selling Wave Hub to the private sector was ruled out as the scheme is still in its infancy, and it was felt to be too much of a financial liability for Cornwall Council or the area’s local enterprise partnership to take on.

Business Minister Mark Prisk said: “Development of the Wave Hub in Cornwall will bring both environmental and economic benefits to the UK and I am pleased that we are able to take this positive step.”

Claire Gibson has been confirmed as Wave Hub’s permanent general manager having acted in an interim capacity since May.

She said: “This secures Wave Hub’s status as a publicly-owned asset, ensures it will continue to be locally run, and reinforces the pivotal role of Wave Hub and Cornwall to the development of a commercial marine energy industry in the UK.”

Around £42 million of public money has already been spent on Wave Hub, and proponents say it is key to creating thousands of jobs in the far South West.

So far only one firm has signed up to take one of the four berths at the Wave Hub, where commercial-scale devices will be tested in the sea and power fed to the grid.

In October, the Government more than doubled the amount of subsidies lavished on the sector through Renewable Energy Certificates (ROCs).

The reform of the green energy funding regime puts the wave and tidal industry in England and Wales on par with Scotland – the Westcountry’s main rival for jobs.

Andrew George, Liberal Democrat MP for the West Cornwall constituency of St Ives, said: “Following a lot of campaigning, I am pleased to see that the Wave Hub has been given a significant boost in recent months.

“Achieving an even playing field with Scotland on the ROCs subsidy and now being given the certainty of full Government backing as it enters its development phase is a real boost for its future. I look forward to seeing major progress in the next two years.”

Wave Hub is the centrepiece of a burgeoning green energy sector in the region.

Ministers have earmarked the South West as the UK’s first marine energy “park”, which could be based across a number of sites in Devon and Cornwall.

Advantages of the status will be similar to those of the Government’s 23 enterprise zones, such as more local control over planning consent.

The region could also be at the head of the queue for Government cash.