Virginia Regulators OK Dominion’s Planned Offshore Wind Farm


RICHMOND, Va. (TUSEN) – State regulators on Friday approved an application from Dominion Energy Virginia to build a massive offshore wind farm off the coast of Virginia Beach and recover the cost from taxpayers.

No party to the months-long process had opposed the project’s approval, which will help the utility increase the proportion of its generation that comes from renewable sources. But many had expressed concerns about affordability and potential risks to the utility’s regular taxpayers.

In its Friday order, the State Corporation Commission noted that the 176-turbine Coastal Virginia Offshore Wind Project will likely be the largest project in Dominion’s history and said it faces a range of challenges because of its size, complexity and location. The commission included three ‘consumer protections’ in its order, including a performance standard.

The commission’s brief also approved installations that will connect the wind farm to the existing transmission system.

Robert Blue, president and CEO of Dominion Energy, said in a statement that the company was satisfied with the approval but was reviewing details of the order, “particularly the performance requirement.”

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The project, which will be located about 27 miles offshore, has an expected capital cost of $9.8 billion and has received widespread support from local officials, policymakers, business groups and unions, who say it will help fight climate change and create jobs. Backers quickly celebrated the committee’s decision.

“We applaud the SCC for greenlighting new offshore wind power in Virginia. As the largest offshore wind project in the country, this project is a critical part of our clean energy transition as it complements solar power by generating power at night when the sun isn’t shining,” Will Cleveland, senior attorney for the Southern Environmental Law Center, said in a statement.

In terms of costs, the SCC order said that over the wind farm’s 35-year expected life, including construction and 30-year expected life, a typical residential customer is expected to see an average monthly bill increase of $4.72. , with a peak monthly bill increase of $14.22 in 2027.

“To be clear, total project costs, including financing costs, less investment tax credits, are estimated to be approximately $21.5 billion on a Virginia legal basis, assuming such costs are reasonable and prudent. somehow find their way into taxpayers’ electricity bills,” the order said.

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Dominion said in a press release that because offshore wind turbines have no fuel costs, the project is expected to save Virginia customers more than $3 billion during its first 10 years of operation.

The consumer protections in the commission’s order include a requirement that Dominion submit a notice within 30 calendar days if it finds that total project costs are expected to exceed current estimate or if final turbine installation is expected to be delayed beyond Feb. 4, 2027 Annual filings must also cover “any material changes” to the project and explain any cost overruns.

The SCC has also ordered that, beginning with commercial operation and through the life of the project, customers will be “held harmless” for any power generation deficit below a certain threshold.

Such a performance standard will protect customers paying for the project from having to pay for alternative energy if the project does not generate the amount of electricity on which Dominion bases its request and its cost estimates, the order said.

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However, the injunction further warns that the performance standard will not protect customers from cost overruns or if the project is halted.

Commissioner Judith Jagdmann agreed in stressing that the project was “legally favoured”.

The Virginia Clean Economy Act of 2020, a major overhaul of the state’s energy policy enacted by Democrats, included a number of renewable energy mandates intended to address the threats of climate change and paved the way for the project.

The General Assembly, Jagdmann wrote, might consider implementing additional consumer protections.

Friday’s decision came after months of extensive filings in the case and a multi-day hearing in May.

The company is already running a pilot project with two turbines. The 2.6-gigawatt project is scheduled to be completed by 2026. Dominion expects the project to generate enough clean energy to power 660,000 households.


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