Dominion Energy’s Offshore Wind Project Faces Budget Pressure

Dominion Energy has revised the cost estimate for its flagship offshore wind development, Coastal Virginia Offshore Wind (CVOW). The utility now anticipates total project expenditures to reach $11.5 billion, an increase from a prior estimate of $11.2 billion. Despite this financial adjustment, the company reaffirmed a key operational target for the current quarter.

• Project: Coastal Virginia Offshore Wind (CVOW)
• Updated Budget: $11.5 billion (up from $11.2 billion)
• Full Completion: Expected by early 2027
• Initial Power Generation: Still scheduled for Q1 2026
• Next Financial Update: Q4 2025 earnings report on February 23, 2026

Drivers of the Revised Estimate

A budget increase of approximately $300 million is attributed to two primary factors. In December 2025, regulators at the Bureau of Ocean Energy Management (BOEM) mandated a temporary construction halt. Work resumed in January following a court-issued injunction. Alongside this delay, higher-than-anticipated tariff expenses have further strained the project's finances.

While the full commissioning of the wind farm is now projected for early 2027, Dominion Energy provided a silver lining for shareholders. The timeline for delivering first power to the grid remains unchanged, with initial electricity generation still on track for the first quarter of 2026. This means the project's revenue generation is expected to commence as originally planned.

Sector-Wide Investment Demands

The development occurs against a backdrop of immense capital requirements across the utility sector. Companies are deploying billions to modernize grid infrastructure, ensure reliability, and meet soaring electricity demand—partly fueled by the rapid expansion of data centers. Dominion Energy's large-scale renewable initiative positions it as a key player in this transition.

Should investors sell immediately? Or is it worth buying Dominion Energy?

Utilities must navigate a complex landscape marked by stringent regulatory oversight and the persistent challenge of maintaining stable consumer energy prices. Beyond capacity expansion, priorities such as enhancing cybersecurity and implementing sophisticated load management systems are gaining prominence.

Financial Outlook and Shareholder Returns

Management will offer a more comprehensive view of the company's financial health and operational progress when it releases fourth-quarter 2025 results on Monday, February 23, 2026.

For investors, the dividend policy remains a steady component. The company confirmed its quarterly cash dividend of $0.6675 per share, payable on March 20, 2026, to shareholders of record on the applicable date. The upcoming earnings report will be scrutinized for signs that efficiency gains across Dominion's broader portfolio can help offset the cost pressures from the CVOW project.