RICHMOND, Va., May 27, 2016 /PRNewswire/ -- Dominion
Virginia Power is assessing options
for its proposed offshore wind demonstration project in light of an
announcement today that the U.S. Department of Energy is
withdrawing $40 million in
funding.
"Naturally, we are disappointed in the DOE's decision because we
still believe that offshore wind has a great potential to deliver
clean, renewable energy to Virginia," said Mary C. Doswell, senior vice president‒Dominion
Energy Solutions. "However, we also recognize the unique regulatory
and cost challenges involved in our project and appreciate the
DOE's desire to support other projects that may have an earlier
opportunity for fruition."
Doswell said Dominion plans to consult with other members of the
project team, known as the Virginia Offshore Wind Technology
Advancement Project (VOWTAP), as well as participants in a
stakeholder group of government, research and community
representatives, before deciding on next steps.
The VOWTAP project would install two advanced-technology,
6-megawatt wind turbines in federal waters about 24 miles off the
coast of Virginia Beach, Va. At
peak production, the turbines would generate enough electricity to
power up to 3,000 homes. Current bids for constructing the project
range from about $300 million to $380
million, compared with an initial estimate of about
$230 million.
Doswell said the DOE made its decision after Dominion could not
guarantee an in-service date for the project earlier than 2020.
While the company has been working toward an earlier date, there
are too many uncertainties to meet DOE's request. These include the
high cost of the project, the inability to get firm construction
contracts, and the increasing complexities of gaining regulatory
approval for energy infrastructure projects.
"This project is a first in many ways," Doswell said. "As such,
you need to account for many variables when attempting to lock in
on a date with any degree of certainty."
VOWTAP was one of three offshore wind projects chosen by the DOE
in May 2014 to receive a second round
of funding.
VOWTAP's other partners are Alstom Power Inc., (recently
acquired by General Electric Company), a wind turbine manufacturer
that will supply the turbines; KBR, a global engineering,
construction, and services firm with experience in offshore wind;
Keystone Engineering, the designer of the innovative substructure;
the National Renewable Energy Laboratory, a federally funded
research and development center; Newport News Shipbuilding, a
division of Huntington Ingalls Industries; and the Virginia Tech
Advanced Research Institute, representing the Virginia Coastal
Energy Research Consortium.
About Dominion Virginia Power
Dominion Virginia Power is a subsidiary of Dominion
(NYSE: D), one of the nation's largest producers and transporters
of energy. Dominion provides energy or products and services to
more than five million customers in 14 states. It has a portfolio
of approximately 25,700 megawatts of generation and 6,500 miles of
electric transmission lines. Dominion also operates one of the
nation's largest natural gas storage systems with 933 billion cubic
feet of storage capacity. For more information about Dominion,
visit the company's website at www.dom.com.
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SOURCE Dominion Virginia Power