The US Interior Department said it hopes to reach an agreement by March over the long-delayed Cape Wind power project in Massachusetts.

If approved the offshore wind farm would increase US renewable energy production, while a defeat would cause a setback for developing a clean energy economy, reports Reuters.

The $1bn Cape Wind project was proposed in 2001 by Cape Wind Associates and would involve building 130 towers on Nantucket Sound to provide electricity to about 400,000 homes.

The project is being opposed by native American groups who say the land is of significant archaeological and cultural importance.

Cape Wind also faces opposition from business leaders and politicians who oppose the 440ft towers that will be visible from homes and resorts in Cape Cod.

The US Interior Department will meet the affected parties next week to seek consensus on actions that could be taken to minimise Cape Wind’s potential impact on historic and cultural resources.