Dominion Raises Coastal Virginia Offshore Wind Cost Estimate to $11.7 Billion
Revised PJM network charges, Trump tariffs and updated installation projections added $288 million to the project's price tag since April.
Dominion Energy disclosed on Friday (2026-07-31) that its 2.6-gigawatt Coastal Virginia Offshore Wind project now carries a total cost estimate of $11.7 billion, up $288 million from the figure the company provided just three months earlier in April.5
Three separate cost drivers pushed the number higher. Revised network upgrade costs assigned by PJM Interconnection account for part of the increase; tariffs imposed by the Trump administration in April added further pressure; and updated turbine installation projections contributed the rest, Dominion said in its second-quarter filing with the U.S. Securities and Exchange Commission.5
The cost revision landed alongside a sharp deterioration in Dominion's quarterly earnings. The company reported net income of $340 million for the second quarter, less than half the $760 million it earned in the same period a year earlier, with rising offshore wind costs and charges related to nonregulated assets among the drags identified in the company's 10-Q filing.5
The PJM network upgrade component is worth flagging separately. PJM serves 67 million customers across the mid-Atlantic and Midwest, and its transmission cost allocations have drawn sustained scrutiny this year. Five state ratepayer advocates argued in July (2026-07-21) that FERC's framework for connecting large loads — principally data centers — to the PJM grid fails to adequately protect other consumers from the associated transmission costs, a dispute that feeds directly into the kind of network upgrade charges now hitting Dominion's project budget.4
Virginia's grid is under particular stress from data center demand. Commercial electricity sales in the state rose by nearly 30 million megawatthours between 2019 and 2025, faster growth than any other state except Texas, according to EIA data — a load surge that has accelerated PJM's infrastructure requirements and, by extension, the cost of interconnecting new generation.2
Dominion's CEO tried to offset the cost news with construction progress. The project is 81% complete and every component type is in service and functioning as expected, he said on the quarterly investor call. The operational turbines can collectively produce more than 450 MW of power, and Dominion said that in recent weeks, as new demand peaks were set, those turbines delivered power at the request of system operators.5
The company also repeated its long-standing customer benefit forecast: CVOW is expected to save ratepayers roughly $5 billion in fuel costs during its first 10 years of operation. That figure has been a fixture of investor presentations for some time.5
The tariff piece is harder to contain. Trump administration import duties imposed in April are embedded in the new cost estimate, but they represent a one-time reset only insofar as tariff policy stays stable. Developers and their financiers have grown increasingly cautious about capital-intensive offshore wind projects that sit inside a policy environment capable of repricing mid-construction, as E&E News reported in May (2026-05-26).1
A potential ownership change adds another dimension. If Dominion's proposed transaction with NextEra Energy succeeds, the combined entity would become the largest regulated utility in the country, with 10 million customers and a 130-gigawatt large-load interconnection pipeline. Dominion said on Friday (2026-07-31) that its own portion of that pipeline has grown 11% since December.5
PJM's capacity market context is not neutral here. The grid operator failed for a third consecutive year to secure enough future supply commitments to meet projected reliability needs, falling 6.8 gigawatts short in its most recent auction, oilprice.com reported in July (2026-07-15). A 2.6-GW offshore wind project delivering power at peak moments carries real system value in that context, which is part of the political and regulatory protection CVOW has retained even as the broader offshore wind sector faces headwinds.3
PJM Western Hub spot power was trading at $62.49 per megawatthour as of Monday (2026-08-03), a price level that reflects the region's ongoing demand intensity and supports the economics of new generation — including offshore wind — at least in the near term.
The number to watch in coming quarters is not the $11.7 billion headline but the trajectory of PJM-assigned network upgrade costs, which are still being revised as the grid operator works through its interconnection queue under sustained large-load pressure. A further upward revision there would test whether Dominion's regulatory compact in Virginia — which has so far shielded CVOW from the cancellations hitting projects elsewhere — can hold if the all-in cost moves materially beyond what state regulators originally approved.5,4