Dominion Virginia Power recently bid $1.6 million to win the lease for 112,800 acres of federal land off the coast of Virginia to develop an offshore wind turbine farm capable of generating up to 2,000 megawatts of electricity, enough for 700,000 homes.

The federal Bureau of Ocean Energy Management (BOEM) conducted the auction. Eight companies, including Dominion, were approved to bid, but only two firms participated. The auction lasted six rounds.

"Offshore wind has the potential to provide the largest, scalable renewable resource for Virginia if it can be achieved at reasonable cost to customers," said Mary C. Doswell, senior vice president-Alternative Energy Solutions. "We will now proceed with the BOEM timetable for development of the commercial wind energy area while advancing our research proposal and looking for ways to lower the cost of bringing offshore wind generation to customers."

BOEM has several milestones that Dominion must meet to keep the lease with the final milestone being the submittal of a Construction and Operations Plan within five years of signing the lease. Once BOEM has the plan, it has an undetermined amount of time to perform an environmental analysis and approve the plan. Dominion expects the first turbine to be installed in about 10 years pending project approval by state regulators.

Others that BOEM had approved to bid were Apex Virginia Offshore Wind LLC of Charlottesville, Va; Energy Management Inc. of Boston; EDF Renewable Development Inc. of San Diego; Fishermen's Energy LLC of Cape May, N.J.; Iberdrola Renewables Inc. of Portland, Ore.; Sea Breeze Energy LLC of Philadelphia; and Orisol Energy U.S. Inc. of Ann Arbor, Mich.

Dominion is involved in other offshore wind research projects. Dominion and its team was one of seven projects selected to receive $4 million each in federal matching funds to undertake initial engineering, design, and permitting for a demonstration facility of two six-megawatt turbines with a goal of finding innovative ways to lower costs of offshore wind. The Department of Energy will select up to three of the projects for follow-on phases to move forward with the final design, permitting, and ultimate construction of these demonstration projects. The projects must be in operation by the end of 2017.