Virginia Beach renews offshore wind land option with Dominion

As Dominion Energy’s massive Coastal Virginia Offshore Wind project off Virginia Beach nears completion, the utility is already laying the groundwork for another offshore venture — a proposed North Carolina wind farm that would rely on 32 acres of Virginia Beach land.

On June 9, the Virginia Beach Development Authority approved a five-year option agreement that would allow Dominion to purchase 32 acres of land the authority owns at Corporate Landing Business Park. The site is critical to the development of CVOW South, Dominion’s proposed offshore wind project in North Carolina, as it would enable a grid interconnection facility and an onshore substation.

The exact purchase price for the land at Corporate Landing hinges on a future appraisal. However, the agreement states that Dominion will pay Virginia Beach at least $200,000 per acre, about $6.4 million. This price is in addition to the $120,000 annual fee Dominion pays for each year of the option.

There’s no planned timeline for the project, Dominion officials said. Under President Donald Trump, a longtime opponent of wind farms, the federal government has paid energy developer Invenergy $765 million to scrap four offshore wind leases it planned for development and instead invest in natural gas power plants in the Midwest.

The administration also reached an agreement in March to pay French energy firm TotalEnergies $1 billion to stop developing two offshore wind farms off the coasts of New York and North Carolina, and placed a 90-day pause on construction of Dominion’s CVOW and four other offshore wind projects at the end of 2025, although federal judges subsequently allowed construction to continue.

Nonetheless, Dominion is keeping its option to develop CVOW South as a second wind farm in the future.

Dominion acquired the 40,000-acre lease about 27 miles off the coast of North Carolina from Connecticut-based energy company Avangrid for $160 million in 2024 and renamed the project CVOW South.

Part of Avangrid’s plan and now Dominion’s plan to develop a new wind farm calls for purchasing the Corporate Landing property to build an onshore substation and grid interconnection point. Avangrid’s original plan called for the construction and operation of up to 69 wind turbines, with a capacity to generate 800 megawatts of power.

Paige Fox, head of business attraction for the city’s economic development department, told the authority in June that with the purchase of the offshore wind lease, an affiliate of Dominion Energy called Kitty Hawk North owned the option agreement as of July 2024. The option expired in March 2025, and last September, Dominion submitted a request for renewal, which has been granted.

Dominion spokesperson Jeremy Slayton described the CVOW South lease area as “an option for future development,” while noting, “at this time, we do not have a firm timeline or cost for developing the lease area. Additionally, we have no capital budgeted for CVOW South in our current plan.”

According to Fox, the CVOW South project is still projected to have 800 megawatts of energy capacity and is estimated to meet the energy needs of 200,000 homes at peak production. She said the project has an estimated cost of $4.5 billion, and Dominion has invested at least $200 million to date.

The project is anticipated to need more than five years of development and construction activities, and it is being driven by the Virginia Clean Economy Act of 2020, which mandates that Dominion has 5.2 gigawatts of offshore wind generation by the end of 2035.

Meanwhile, progress continues on Dominion Energy’s $11.5 billion CVOW off Virginia Beach’s coast, which delivered its first power to the grid in late March. The project’s turbines are about 380 feet tall and have a capacity of 14.7 megawatts. Slayton said that CVOW will continue to deliver more power to the grid as additional turbines are installed.

Slayton said that as of Wednesday, Dominion has installed 22 wind turbines and project construction is more than 75% complete. The company expects the majority of turbines to be placed in service by the end of 2026 and the remainder in early 2027 prior to the end of June. Once operational, CVOW will consist of 176 wind turbines generating up to 9.5 million megawatt-hours per year.

In May, Florida-based Fortune 200 company NextEra Energy entered an agreement to acquire Dominion for approximately $66.8 billion in an all-stock transaction. At the June 9 meeting, a Virginia Beach authority board member got confirmation that if the merger closed, the option agreement would transfer to the new company or a related entity.