Off the coast of Virginia, Dominion Energy is building what will be the largest offshore wind facility in the U.S., a 2.6-gigawatt project that will provide energy to as many as 660,000 homes. It has been under construction since 2023 and is expected to be completed by 2026—but President Donald Trump’s tariffs are adding to the project’s costs.
Already, through the first quarter of 2025, Dominion’s Coastal Virginia Offshore Wind project has incurred tariff costs of $4 million, CEO Bob Blue said on a recent earnings call. That increase came from Trump’s 25% tariffs on steel, which the president announced in early February and which went into effect March 12.
If the tariffs continue through the second quarter, the company expects that number to increase to $120 million. If they continue through to the end of 2026, it could hit $500 million. (That includes the steel tariffs, as well as general tariffs on imports from Mexico, Canada, and the European Union. It’s worth noting that tariffs on steel imports also drive up domestic prices.)
Dominion plans to bear some of those cost increases itself; of that projected $500 million increase, for example, Dominion will cover about $130 million. It also noted that the updated costs could increase residential customer bills by an average of 4 cents a month over the life of the project. The Coastal Virginia Offshore Wind project “remains one of the most affordable sources of energy for our customers,” Blue noted.
Before the earnings call, Dominion Energy already announced that the offshore wind project’s costs had increased, compared with initial estimates; initially, it was set to cost $9.8 billion, but in February 2025, Dominion bumped that estimate to $10.7 billion. That was the first budget increase since Dominion submitted the project to Virginia regulators back in November 2021, and Dominion said it was because of higher network upgrade costs assigned by the local grid operator, PJM.
At the time of that announcement, Dominion noted that the project was 50% complete and on track to be finished by the end of 2026.
Trump’s tariffs have led to all sorts of price increases and uncertainty about the future. Tariffs on car and car part imports are expected to raise vehicle prices; tariffs on steel and aluminum could make everything from construction materials to appliances to canned food more expensive. Trump’s trade war will also broadly impact renewable energy because many of the parts for solar and wind projects come from abroad, particularly China and Southeast Asia.
Trump has also taken steps to kill the wind industry generally, and has halted some offshore wind projects, like Empire Wind off the coast of Long Island, which was set to be completed by 2027 if the work continued on schedule.
Dominion says that it’s confident its Coastal Virginia Offshore Wind project will get done, despite Trump’s hatred of wind power and his recent actions to hamper clean energy projects. The company’s conversations with federal regulators “have continued the same way they have been for months,” Blue said during the earnings call.
A pause on the project, he added, wouldn’t make sense: “It’s the fastest way to get 2.6 gigawatts on the grid to serve tech companies, defense, and security installations, and important American industries like shipbuilding. It’s employing 2,000 people. . . . It has bipartisan support in Virginia.” (Trump has, however, taken aim at clean energy projects even in red states, including by freezing Inflation Reduction Act funding, which specifically brought billions of dollars to Republican districts.)
And even though tariffs are adding some uncertainty to the project’s cost, Blue noted that their impacts are “manageable.” “We’ve worked on our supply chain for some time. . . . the vast majority of the materials that we procure are directly from U.S. suppliers,” he said. “We have been placing some orders ahead of tariff effective dates to mitigate cost increases where it’s possible.”
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