Dive Brief:
- The Bureau of Ocean Energy Management gave the 2.6-GW Coastal Virginia Offshore Wind, or CVOW, project a green light on Tuesday. The project will be built 23.5 miles off the coast of Virginia Beach by Dominion Energy.
- CVOW is the fifth project and largest offshore wind farm to receive a favorable Record of Decision from BOEM.
- Rising costs have pushed other U.S. offshore wind developers to cancel their power purchase agreements, but Dominion Energy says they have secured fixed-cost contracts for the vast majority of expenses critical to CVOW's completion.
Dive Insight:
Dominion Energy's CVOW project is currently set for completion on schedule, and on budget, according to company spokesman Jeremy Slayton.
BOEM's favorable decision on Tuesday clears the way for Dominion Energy to begin on-shore construction for the project, Slayton said, although offshore construction will need to wait for BOEM's final approval of the project's construction and operations plan, expected Jan. 29. The project's first eight monopile foundations arrived at the project staging site at Virginia's Portsmouth Marine Terminal just days ahead of Tuesday’s announcement.
Construction should begin in earnest in early 2024, Slayton said, and is slated for completion in 2026 — with the possibility that some turbines will begin producing power in late 2025.
“We secured this lease back in 2013, so this is something that we have been working on for over a decade and today is a big, major milestone for the team,” Slayton said. Keeping the project on time and on budget, he said, “is a good thing for Dominion Energy, a good thing for our customers, a good thing for Virginia, and a good thing for offshore wind. It shows that offshore wind is important and vital to the clean energy future.”
Will Cleveland, senior attorney for the Southern Environmental Law Center, noted that the Virginia State Corporation Commission took steps early in the process to ensure that if the CVOW project experienced cost overruns or delays, those additional costs would fall on Dominion Energy shareholders and not on customers, giving the company an extra incentive to keep the project on track. The commission, Slayton said, also required Dominion to lock in contracts in 2020 and 2021 in order for the project to win its full approval.
Cleveland praised Dominion's commitment to meeting these obligations, as well as its commitment to mitigating the project's potential impacts on wildlife.
“The goal is to have this be the model for how we can cost effectively and environmentally responsibly develop offshore wind in the United States,” Cleveland said.
Although Dominion Energy's current integrated resource plan contemplates the construction of a second offshore wind farm of similar size, Slayton said CVOW is for the time being the only offshore wind project the company is actively pursuing.
