Dominion Energy said that escalating materials and supply costs will jack up the price tag of its 2.6-gigawatt Coastal Virginia Offshore Wind project by over 20% to $9.8 billion.
The planned array of 176 Siemens Gamesa 14.7-megawatt turbines, planned to begin operation in 2026, is the largest U.S. offshore wind project now in development, and Dominion is building the first Jones Act-compliant wind turbine installation vessel, the 472’ Charybdis, at Keppel AmFELS at Brownsville, Texas. In addition to that $500 million project, Dominion announced an array of other contracts Nov. 5.
Wind contractor DEME Offshore US LLC said it had secured a $1.1 billion balance of plant contract in consortium with Prysmian Group for installation of turbine foundations, substations and cables. DEME called it “the largest offshore wind installation contract ever awarded in the U.S.”
“We are moving the CVOW project forward by working with industry leaders as we bring utility scale offshore wind generation to our Virginia customers,” said Joshua Bennett, Dominion Energy vice president of offshore wind. “These contracts will allow us to manage costs for the benefit of our customers and take advantage of the developing domestic supply chain to deliver on our promise to bring clean-energy jobs to Hampton Roads.”
The recent contracts include:
• EEW SPC will manufacture 176 steel monopile foundations, the largest of which will be 268 feet long and weigh 1,755 tons.
• Bladt Industries will supply 176 transition pieces, which weigh as much as 800 tons and bind the monopile foundation and turbine together, and provide technicians access to turbines.
• Bladt and Semco Maritime will manufacture components for three offshore substations, multistory units weighing about 4,000 tons each, a topside platform with helicopter landing pad 157 feet above the water and support structures installed in the sea floor.
• Prysmian Group will provide all of the subsea inter-array and export cables that will deliver the clean, renewable offshore wind energy to shore.
Monopile foundations, transition pieces, and turbine components will be staged on 72 acres at Portsmouth Marine Terminal as part of a 10-year lease agreement with the Virginia Port Authority.
Dominion says it will use U.S.-flagged vessels that are compliant with the Jones Act to transport components from the Portsmouth terminal to the construction site in the CVOW lease area that begins 27 miles off the Virginia Beach coast and extends an additional 15 miles East into the Atlantic.
The low voltage energy generated by the wind turbines will be collected at the offshore substations and transmitted to shore at a higher voltage along buried undersea export cables. Once the substations are energized, they will be serviced by newly created positions on the Dominion Energy offshore wind operations and maintenance team.
“During operation, the CVOW commercial project could result in 1,100 jobs, generate $11 million per year in local and state tax revenue and almost $210 million in economic benefits annually,” according to Dominion. “Customer costs will be reduced by applicable federal tax credits and offshore wind will have no fuel costs over the life of the project.
“Over this time, the net average cost of the project to a typical residential customer is estimated at approximately $4 per month, though this figure will initially be less and will vary from year-to-year. All of the project's costs are subject to approval by the State Corporation Commission which will also consider the applicable tax credits of more than $1 billion and expected fuel costs savings of more than $3 billion for the project's first 10 years."
"Our customers expect reliable, affordable, and clean energy and we intend to deliver. In addition to solar, storage and nuclear, offshore wind is a key component of our strategy and a game changer for the Hampton Roads economy," said Robert M. Blue, Dominion Energy chairman, president and CEO.