Dominion Energy says the cost of its Coastal Viriginia Offshore Wind (CVOW) project could rise steeply as a result of tariffs imposed by the Trump administration
In a Q1 2025 earnings call on 1 May 2025, the company said tariffs on imported steel and other tariffs would drive up the cost of the 2.6-GW offshore windfarm.
To date, the cost increase has been limited, but should tariffs remain in place at current levels through the end of Q2 2025, the company could incur extra costs of around US$120M.
A presentation released to coincide with the earnings call showed that, should tariffs remain in place at their current level until the project is due to be completed towards the end of 2026, much more serious costs could be incurred – potentially up to US$500M.
The increase in costs is attributable to the increased cost of importing from Canada and Mexico, the increased cost of importing steel for the project, some of which is coming from Canada and Mexico, and non-steel costs of products imported from the European Union.
Under the terms of its agreement with Stonepeak, with whom Dominion Energy closed a transaction to sell a 50% noncontrolling interest in the CVOW project in October 2024, Dominion Energy will share any additional costs incurred.
The project’s current capital budget has risen to US$10.8Bn, including circa US$120.0M as a result of tariffs that will be incurred by the end of Q2 2025. As of 31 March 2025, a total of US$6.8Bn has been invested. Of the remaining project costs of circa US$4.0Bn, 50% will be funded by Stonepeak via non-controlling equity financing, and the remaining amount, circa US$2.0Bn, by Dominion Energy.
Dominion Energy said the installation vessel it is building for the project, Charybdis, is 98% complete, and it has completed initial sea trials. It expects to take delivery ofCharybdis in the next four to eight weeks, on schedule, to support turbine installation this summer, as planned. The company said the total project cost of the vessel, including financing, is now US$715M.
The company said CVOW is now slightly more than 55% complete, and months away from first delivery of electricity to customers in early 2026. The project remains on schedule for full completion at the end of 2026. Dominion Energy noted the offshore windfarm “has the robust bipartisan support of Virginia’s government and congressional leaders” and “strong support from local communities, military and defence interests, the commercial marine industry, as well as civic, educational, environmental, labour and community partners.”
