Regulators at the State Corporation Commission are reviewing Dominion Energy’s proposal for its long-touted Coastal Virginia Offshore Wind project. It’s set to be a big part of Virginia’s plan to transition to a zero-carbon emissions electric grid — which United Nations officials and climate scientists worldwide say needs to be fully realized as soon as possible.
But in a hearing in Richmond at the Virginia SCC building on Tuesday, some involved in the case expressed concerns that Virginia ratepayers could be left footing a larger-than-expected bill, citing Dominion’s limited experience in offshore wind and unexpected project costs.
Renewable energy advocacy group Clean Virginia, the state attorney general’s office and Walmart (one of Dominion’s biggest customers) did not sign on to a recently made agreement between Dominion and other stakeholders. Their main concern is the potential for the project’s cost to balloon due to construction delays, supply chain problems, inflation and more.
They said those costs, as state code is written, are likely to be passed onto ratepayers, and not borne by Dominion or its shareholders.
Lawyers for Clean Virginia asked for the commission, which regulates Dominion and other utilities, to find CVOW’s scale and complexity as unprecedented — and called on them to make the company and its shareholders responsible for cost increases.
Representatives from the attorney general’s office said the nature of the project’s ownership — exclusively owned by a monopoly utility — is unusual and puts Dominion customers at risk of cost overruns. And since the industry is new to the U.S., costs of establishing supply chains will be high.
Dominion’s VP of project construction, Mark Mitchell, defended the company’s $9.65 billion price tag for CVOW when asked about the likelihood of cost increases.
“It is what we are confident in delivering the project for, based on everything known to date,” Mitchell said in the hearing.
The $9.65-billion figure is up about $1.5 billion from the original proposal — though Mitchell said it was recently adjusted down to account for the U.S. dollar’s favorable performance over the Euro.
Eileen Woll, of the Sierra Club of Virginia, agrees that initial project costs will be high, but argues they will plummet in time.
“You really have to put offshore wind on a scale,” Woll told VPM News. “The benefits are so extraordinary.”
She pointed to Dominion’s projection of creating 1,100 long-term jobs once the project is completed, as well as the wind industry infrastructure that is already taking root in the Port of Virginia as a future source of manufacturing and construction jobs.
After disagreements regarding workforce diversity requirements in state law, Dominion, the Sierra Club, the Nansemond Indian Nation and SCC staff came to an agreement last week.
As part of that filing, Dominion agreed to have at least a 40% diverse workforce by 2026. The company also has agreed to host at least 20 business opportunity and energy career events, half of which must be organized with local small and diverse business groups.
Woll said the biggest win is the inclusion of an advisory committee, which would have power to review and make recommendations on Dominion’s diversity, equity and inclusion progress updates.
The hearing is set to continue Wednesday. A decision from the commission is expected by the end of August, though Dominion still needs federal approval to move ahead with CVOW.
