Port of Virginia to lease terminal to Dominion for offshore wind project

The Port of Virginia will lease the Portsmouth Marine Terminal to Dominion Energy in what Virginia Gov. Ralph Northam called “the critical next step to propel development of the largest offshore wind project off the East Coast.”

“The agreement between the Port of Virginia and Dominion Energy will dramatically accelerate the commonwealth’s transition to clean, renewable energy, create good-paying jobs, and expand Virginia’s economy,” said Northam.

The announcement came during the kickoff for the International Offshore Wind Partnering Forum, a major global offshore wind conference that describes itself as the largest offshore wind conference in the Western Hemisphere. This year’s event is being held in Richmond. 

Virginia has over the past two years aggressively embraced a transition from fossil fuels to renewable energy, particularly through the 2020 Virginia Clean Economy Act. That Democrat-led initiative commits the state’s electric grid to being carbon-free by 2050, sets binding targets for electric utilities to source their power from renewables and meet energy efficiency goals and establishes ambitious mandates for the development of wind, solar and energy storage. 

Key to the law are also provisions smoothing the path for Dominion Energy, the state’s largest electric utility, to develop offshore wind off Virginia’s coast. 

Dominion was the first U.S. company to construct and operate offshore wind turbines in federal waters through its Coastal Virginia Offshore Wind pilot project. 

In September 2019, the company announced it would build the nation’s largest offshore wind farm to date, capable of producing 2,600 megawatts of power. The utility will need to obtain regulatory approval for the project from the State Corporation Commission before beginning construction. 

The project will also be the first offshore wind development in the U.S. owned by an electric utility. Elsewhere, wind farms are being developed by private non-utility companies that then contract to sell their power to utilities. 

Under the agreement announced by Northam Wednesday, Dominion will lease 72 acres of the Portsmouth Marine Terminal as a staging and pre-assembly area for the commercial CVOW turbines for 10 years, with an option for two five-year renewals. A release from the governor’s office said the agreement “includes significant upgrades to ensure the terminal can handle the weight” of the turbine components.

On Wednesday morning, Dominion CEO, Chair and President Bob Blue said he anticipates not only completing the commercial phase of the Coastal Virginia Offshore Wind project but building up to 5,100 megawatts of wind power by 2035. 

Both he and Northam touted the advantages of Virginia to offshore wind industry players, citing its skilled maritime workforce and deep, centrally located port.

“We see Virginia as the perfect hub for this booming industry,” said Northam, who several times noted CNBC’s ranking of Virginia as “the best state for business” for the third year in a row. 

Blue also emphasized the employment opportunities officials hope offshore wind development will bring, saying that the Bureau of Labor Statistics has identified wind turbine service technicians as the fastest-growing occupation and that median hourly wages for energy workers are more than a third higher than the national median wage.