Dominion Energy Raises Offshore Wind Cost Estimate by $250M as NextEra Merger Advances
The Virginia utility reaffirmed 2026 guidance and pushed final turbine installation to mid-2027 while regulatory reviews of its proposed $89 billion NextEra combination proceed.
Strong Quarter Amid Merger Proceedings
Dominion Energy reported second-quarter operating earnings of $0.79 per share, including $0.03 from renewable natural gas tax credits, and reaffirmed its full-year 2026 guidance as the utility advances its $89 billion combination with NextEra Energy (earnings call, 2026-07-31).
The Virginia State Corporation Commission has scheduled evidentiary hearings on the proposed merger beginning November 17, while South Carolina's commission is expected to rule next week on a proposed hearing date of December 8 (earnings call, 2026-07-31). Under the transaction terms announced in May, Dominion customers would receive $2.25 billion in shareholder-funded bill credits.
"This transaction represents a truly transformational opportunity to bring together 2 world-class utilities with 238 years of collective industry experience," CEO Robert Blue said on the call.
Offshore Wind Project Nears Half Complete
Dominion's flagship Coastal Virginia Offshore Wind (CVOW) project has reached 81% completion, with 31 of 176 turbines now installed and operational. The utility has updated its cost estimate to $11.65 billion, an increase of approximately $250 million from the previous $11.4 billion budget (earnings call, 2026-07-31).
The cost adjustment reflects $228 million in additional tariff costs for steel and aluminum, $234 million in miscellaneous expenses including cable protection and fuel costs, and $288 million to account for an extended installation timeline. These increases were partially offset by a $502 million reduction from reallocated PJM network upgrade costs (earnings call, 2026-07-31).
Dominion now expects to complete the final turbine installation six months later than previously anticipated, pushing the timeline to mid-2027. The delay accounts for additional weather and vessel maintenance contingency, longer loadout times at the Portsmouth Marine Terminal, and extended jacking operations at certain turbine locations based on subsea geotechnical analysis (earnings call, 2026-07-31).
Despite the adjustments, CFO Steven Ridge emphasized that "CVOW is significantly different from a traditional power plant" because each turbine functions as an individual power plant entering service upon completion. The 31 installed turbines already represent more than 450 megawatts of capacity, "rivaling the magnitude of some of our fossil units" (earnings call, 2026-07-31).
The project is expected to generate approximately $5 billion in fuel savings for customers during its first decade of operation, with one-third of recent cost increases shared with Dominion's financing partner (earnings call, 2026-07-31).
Data Center Demand Drives Record Peaks
Dominion reported accelerating electricity demand in its Virginia service territory, with nine of the company's top 10 all-time peak days occurring in 2026, including the eight highest summer peaks in the past two months (earnings call, 2026-07-31).
The utility now has over 53 gigawatts of data center capacity in various contracting stages, including approximately 12 gigawatts under electric service agreements—an increase of more than 5 gigawatts since year-end 2025 (earnings call, 2026-07-31).
Dominion completed its 2026 common equity program and reported funds from operations to debt metrics above 15% for both full-year 2025 and the last-twelve-month period ending Q2 2026 (earnings call, 2026-07-31). According to MarginX data, the company has a September 3 special shareholders meeting scheduled, likely related to the NextEra merger vote.
This article was generated by MarginX from the earnings call on 2026-07-31. It is not investment advice.