Dominion's Virginia Offshore Wind Project Costs Swell to $11.5 Billion Amid Tariffs, Legal Delays
The financial hurdles facing one of America's most ambitious offshore wind ventures have grown steeper. Dominion Energy disclosed in a regulatory filing late last week that the estimated cost for its Coastal Virginia Offshore Wind (CVOW) project has escalated to approximately $11.5 billion—a $300 million increase from its previous forecast of $11.2 billion.
The revised figure, which includes contingency funds but excludes financing costs, underscores the persistent volatility in the offshore wind sector. According to the filing, the uptick is attributed to recently imposed tariffs on imported components and a significant, albeit temporary, federal halt to construction activities.
In December, a federal stop-work order brought the Virginia Beach project and four other East Coast wind developments to a standstill. The order was part of a broader legal challenge concerning environmental reviews. Dominion successfully secured a preliminary injunction on January 16, after arguing that further delays would cause "irreparable harm" to the project's timeline and finances. Construction has since resumed while the underlying lawsuit against the federal government proceeds.
This latest increase marks a substantial climb from the project's original $9.8 billion budget when construction commenced in May 2024. To date, Dominion has invested $9.3 billion into the 2.6-gigawatt endeavor, which is now roughly 71% complete. The company anticipates needing an additional $2.2 billion to reach completion, with plans to fund about $1.2 billion of that remaining sum.
Despite the financial headwinds, a key milestone was reached last week with the installation of the first offshore turbine tower. Dominion maintains that the wind farm will begin delivering its first electricity to the grid within the coming weeks, aligning with its first-quarter target. Full commercial operation, however, has been pushed to early 2027.
Industry Voices React:
"This cost revision is a tough but expected bump in the road," said Michael Thorne, a renewable energy analyst at Chesapeake Consulting. "Global supply chain pressures and regulatory uncertainty are taxing every major project. The critical fact is that construction is moving again, and first power is days away—that's a win for Virginia's clean energy transition."
"It's a classic bait-and-switch for ratepayers," countered Sarah Jenkins, a community advocate from Norfolk. "First it was $9.8 billion, now it's $11.5 billion. Who's left holding the bag? Families and businesses through higher bills. This project is becoming a monument to mismanagement and broken promises in the rush to go green."
"The January injunction was vital to prevent cascading delays across our supply chain," noted David Chen, Dominion's VP for Offshore Wind. "While costs are challenging, the long-term value—thousands of jobs, energy independence, and carbon reduction—remains undeniable. We are focused on executing the final stages."