Dominion Energy’s Coastal Virginia Offshore Wind (CVOW) project is steadily progressing toward its end-of-2026 completion, reaching key construction milestones while facing an updated cost estimate. The 2.6-gigawatt (GW) offshore wind farm—the largest in the U.S.—is expected to generate clean energy for up to 660,000 homes, but recent financial updates indicate a modest increase of $0.43 per month on residential customer bills.
CVOW has successfully installed 16 transition pieces, crucial components connecting the wind turbine foundations to their towers. Additionally, Dominion Energy has received the first of three 4,300-ton offshore substations at the Portsmouth Marine Terminal in Virginia Beach. Fabrication of wind turbine towers and blades is in full swing, with nacelle production set to begin later this quarter.
The project’s turbine supplier, Siemens Gamesa, is manufacturing the same model currently in use at the Moray West offshore wind farm in Scotland, reinforcing the reliability of the technology. Meanwhile, Charybdis, the American-built wind turbine installation vessel, is now 96% complete and undergoing sea trials in Texas. These developments signal steady progress toward the on-time installation of 176 turbines off Virginia’s coast.
Since its initial approval in 2021, CVOW’s total estimated cost has risen from $9.8 billion to $10.7 billion, marking a 9% increase. This adjustment is primarily due to higher network upgrade costs assigned by PJM, the regional grid operator responsible for integrating the wind farm into the existing power system. While these infrastructure updates do not affect the construction timeline, they have contributed to an increase in project expenses.
To mitigate financial strain on customers, a cost-sharing agreement approved by the Virginia State Corporation Commission (SCC) in 2022 ensures that 50% of project costs exceeding $10.3 billion will not be passed on to ratepayers. However, the expected financial impact on a typical residential customer using 1,000 kWh per month is a $0.43 monthly increase—a cost Dominion Energy argues remains competitive compared to other energy alternatives.
Despite CVOW’s continued progress, the offshore wind sector in the U.S. is grappling with rising material costs, supply chain delays, and regulatory uncertainty. Recent offshore wind setbacks include New Jersey halting new offshore wind contracts and Orsted canceling two major projects off the East Coast due to financial concerns.
However, Dominion Energy maintains that CVOW’s financial structure and bipartisan support from Virginia’s leadership, local communities, and environmental groups provide stability. The project is expected to generate 2,000 direct and indirect American jobs and $2 billion in economic activity, reinforcing its role in Virginia’s clean energy transition.
The CVOW project has faced legal and community opposition in recent months, particularly concerning marine life impacts, construction disruptions, and regulatory challenges.
Dominion Energy remains committed to completing CVOW on time and within budget constraints, reaffirming its 2025 operating earnings per share (EPS) guidance and long-term growth targets. The company will discuss the project’s financials and strategic outlook in its fourth-quarter earnings call on February 12, 2025.
While the $0.43 monthly bill increase reflects the growing costs of integrating large-scale renewable energy projects into the grid, CVOW is positioned to deliver long-term clean energy benefits, reducing dependence on fossil fuels and supporting Virginia’s climate goals.
