Offshore wind energy project led by Dominion experiences a modest increase in costs due to tariffs, as per the company's CEO.
The Coastal Virginia Offshore Wind (CVOW) project, owned by Dominion Energy, is moving forward despite a significant increase in costs due to President Trump's tariff policies. The project, which involves installing 176 Siemens Gamesa turbines to generate 2.6 GW of electricity, has seen its total cost rise to $10.9 billion, an additional expense of $506 million.
Despite this added expense, Dominion Energy has worked closely with vendors to implement cost mitigation strategies. The utility is "quite pleased" with the ultimate shape of the One Big Beautiful Bill Act, which significantly reduced and curtailed many of the IRA's renewable energy tax credits. As a result, Dominion Energy expects to preserve all of the credits that it's provided in its forecast to investors, either through safe harboring or under long-standing rules.
The utility has delayed the completion of Charybdis, the first Jones Act-compliant offshore wind turbine installation vessel in the U.S., due to work on the vessel's internal communication technology. However, the project is still on track for completion by the end of 2026 and delivery of electricity in early 2026. The project remains one of the most affordable sources of energy for Dominion Energy's customers.
The project's pin piles have all been installed, and as of the latest update, 134 of the project's 176 monopiles have been installed, representing 76% completion. The project is currently installing monopiles at a pace that exceeds any other U.S. offshore wind project to date. Charybdis eliminates the need for barges, which will aid in staying on track with turbine installation.
The increased costs will lead to an average increase of three cents per month in customer bills over the entire life of the project. Dominion Energy doesn't expect the CVOW project or many of its other projects to be impacted by the One Big Beautiful Bill Act. Only about 20% to 25% of Dominion Energy's clean energy projects will "require some active mitigation."
The first turbine of the CVOW project is scheduled to be installed in September, which is in line with the original schedule. The project remains on track, and Dominion Energy benefits from strong logistical planning, including the use of a U.S.-built installation vessel that complies with the Jones Act. Despite the tariff challenges and political headwinds related to offshore wind, Dominion Energy expects to meet major milestones.
The utility, Dominion Energy, has found ways to mitigate costs in the renewable-energy sector, as seen in their work on the One Big Beautiful Bill Act that significantly reduced renewable energy tax credits in the industry. Despite a three cents per month increase in customer bills due to the increased costs of the Coastal Virginia Offshore Wind (CVOW) project, this source of energy remains one of the most affordable for Dominion Energy's customers.
