Dominion explores designating coastal area for offshore wind

Richmond, Va., March 19, 2012 — Dominion Virginia Power told the federal government today that it is interested in obtaining leases off the Virginia coast in an area that has the potential to generate about 1,500-2,000 MW of electricity from offshore wind turbines. The exact capacity would be dependent on detailed site investigations.

Dominion expressed its interest in the entire 113,000 acres the government is making available about 24 miles off the Virginia coast in its response to the Bureau of Ocean Energy Management's Call for Information and Nominations issued Feb. 3.

The U.S. Energy Information Administration projects the cost of offshore wind generation in 2016 at about 24 cents per kWh generated. This is a premium over the 7.3 cents per kWh that comprise the generation portion of Dominion Virginia Power's residential rate today of about 10.9 cents per kWh. 

The company has received a two-year, $500,000 grant from the U.S. Department of Energy with a goal to find innovative ways to reduce the cost of offshore wind generation by 25 percent.

As with any utility generating project, the Virginia State Corporation Commission would have to approve any Dominion Virginia Power offshore wind power generation project.

If awarded a lease, Dominion said it would conduct detailed site assessment activities, including the erection of a meteorological tower to study wind strength and patterns.

The leasing area is divided into 19 whole blocks, each 3-by-3 miles, and 13 partial ones. Because navigational and environmental studies may further limit suitable areas for development, Dominion nominated all of the lease blocks so it would be positioned to propose a project with beneficial economies of scale.

BOEM said responses to its call for information could lead to initiation of a competitive bidding process for tracts where more than one expression of interest is received or a noncompetitive process if there is not more than one.

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