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Port of Virginia, Dominion Energy Reach Deal to Propel Offshore Wind Industry

August 26, 2021 by Dan McCue
The Portsmouth Marine Terminal in VIrginia.

RICHMOND, Va. – The Port of Virginia says it will lease a portion of its Portsmouth Marine Terminal to Dominion Energy in a bid to accelerate construction of the largest commercial offshore wind farm in the United States, and ensure the commonwealth benefits from the resulting on-shore economic development and jobs.

Under the agreement, Dominion Energy will use 72 acres of the deep-water, multi-use marine cargo Portsmouth Marine Terminal as a staging and pre-assembly area for the foundations and turbines that will be installed 27 miles off the coast of Virginia Beach. 

The Virginia wind project will produce more than 2,600 megawatts of clean, renewable energy–enough to power up to 660,000 homes.

“This announcement is yet another milestone toward making Virginia the national leader in offshore wind power,” said Gov. Ralph Northam in a written statement. 

“The Commonwealth and Dominion Energy are standing together to promote clean energy, reduce carbon emissions, create jobs, and build a new American industry on the East Coast of the United States,” he said.

Robert Blue, president and CEO of Dominion Energy described the port’s location as “second to none,” having “deep water access, no overhead restrictions, a strong, experienced maritime workforce and sufficient space for these large wind infrastructure components. 

“It is perfectly situated to serve the Virginia offshore wind project and grow the domestic supply chain needed to complete other offshore wind projects in the United States,” he said.

Northam and Blue announced the lease agreement at the Business Network for Offshore Wind’s International Partnering Forum, a three-day global conference being held at the Greater Richmond Convention Center. 

It is the largest offshore wind conference in the Western Hemisphere. More than 1,300 people are participating in person, and another 1,000 online.

The lease term is 10 years–valued at nearly $4.4 million annually–and includes an option for two five-year renewals. The lease agreement includes significant upgrades to ensure the terminal can handle the weight of the large components that will be deployed to build the offshore wind turbines. Once the components are loaded onto ships, the vessels will travel to the construction site 27 miles off the coast of Virginia Beach.

The agreement comes just 18 months after Northam signed into law the Virginia Clean Economy Act, committing the state to clean and renewable energy. The law sets a target of 2034 for producing at least 5,200 megawatts of energy through offshore wind, and a target of 2045 for achieving 100% carbon-free energy production.

Negotiations accelerated in July, when the Virginia Port Authority Board of Commissioners directed Stephen A. Edwards, CEO and executive director of the VPA, to finalize the lease negotiation.

“For the last several years it has been known that The Port of Virginia, and specifically the Portsmouth Marine Terminal, is positioned to be the leading Mid-Atlantic logistics hub for the offshore wind industry,” Edwards said. 

“This agreement capitalizes on PMT’s potential and solidifies Virginia’s place as the leader in this growing and competitive field. This port is ready to support Dominion Energy and all of the businesses and jobs that will ensure the success of offshore wind in Virginia,” Edwards added.

Dominion Energy’s two-turbine pilot project is operating off the coast of Virginia Beach. Last month, the Bureau of Ocean Energy Management issued a “Notice of Intent” for the full commercial project. 

The Notice of Intent triggers a federal review of the project and preparation of an Environmental Impact Statement, which will take about two years.

The Biden administration has set a target of developing 30 gigawatts of offshore wind capacity by 2030.

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