Cost of Va. Beach wind farm increases by close to $1B

Eggs aren’t the only thing getting more expensive. The estimated cost to build Dominion Energy’s Coastal Virginia Offshore Wind (CVOW) project has increased from $9.8 billion to 10.7 billion, a 9% jump.

Over the life of the project, the expected average impact to the monthly bill of a residential customer who uses 1,000 kilowatt-hours a month is 43 cents, the Richmond-based Fortune 500 utility stated in a project update distributed Monday afternoon.

The 2.6-gigawatt project, which is expected to provide enough energy to power 660,000 homes, is now 50% finished and remains on track for expected completion in 2026. It’s located 27 miles off the coast of Virginia Beach.

Dominion attributed the cost estimate increase to a revised estimate of network upgrade costs assigned by PJM Interconnection, the company that operates the electric grid for a region that runs from New Jersey to North Carolina, and from Illinois to Washington D.C., and on higher onshore electrical interconnection costs.

Dominion noted this is the only increase in the project’s budget since it was submitted to the Virginia State Corporation Commission in November 2021.

Also in Monday’s update, Dominion announced that CVOW’s first 16 transition pieces, which serve as the junction between the foundation and tower for each of the 176 wind turbines, have been installed.

The first of three 4,300-ton offshore substations was delivered to the Portsmouth Marine Terminal in Virginia Beach at the end of January.

Wind turbine tower and blade fabrication is underway and nacelle fabrication — making containers for turbine working parts — will begin later this quarter, according to Dominion.

Spanish-German wind engineering company Siemens Gamesa, the project’s wind turbine supplier, is manufacturing the same turbine model for CVOW that operates at the Moray West offshore wind project, which is located off the coast of Scotland.

Charybdis, the first U.S.-built wind turbine installation vessel, is now 96% completed and has launched sea trials in Texas.

In October 2024, Dominion completed its $2.6 billion sale of a 50% noncontrolling stake in CVOW to investor Stonepeak.

At the beginning of his second term, President Donald Trump issued an executive order that temporarily ceases all federal wind leases under consideration and called for an “immediate review” of the policies before resuming. On Jan. 20, 2024, Dominion issued a statement that it is “confident CVOW will be completed on time, and that Virginia’s clean energy transition will continue with bipartisan support for many years to come.”

Dominion provides regulated electricity service to 3.6 million homes and businesses in Virginia, North Carolina, and South Carolina, as well as regulated natural gas service to 500,000 customers in South Carolina.