Hamilton Utilities Corporation Shareholders Receive Electra Utilities Update

Hamilton Utilities Corporation shareholders received an update on Electra Utilities' financial results, reliability performance, capital plans and future funding needs. The discussion focused on electricity infrastructure spending, projected demand growth from electrification and development, upcoming rate applications, and the possibility that municipal shareholders may need to contribute new equity to support expansion.

Topics Discussed

1. ELECTRA PERFORMANCE: reliability, rates and financial results

Electra president and CEO Brian Bentz said the utility is focused on "reliability" and "affordability," which are "forefront in our mind." He said the company continues to invest in underground cables, substations and grid automation, and reported reliability performance above the sector average.

The presentation said Electra recorded 2025 net income of $144 million, $24 million above budget, with about $400 million in free cash flow and $391 million in capital investments. Hamilton Utilities Corporation CEO Jeff Cowan said Hamilton Utilities "functions as the shareholder that manages the city's … 17.3% interest into Electra Utilities." The city has received about $120 million in dividends since 2017.

Andrea Horwath said Electra expects "dividend growth to increase at about 11% compounding annual growth rate to 2031, with net income reaching in excess of 200 million by 2031."

2. CAPITAL PLAN: $3.1 billion across the service area, including more than $600 million projected in Hamilton

Electra outlined a proposed 2027-2031 capital program of $3.1 billion across its service area. An unidentified presenter said, "The total capital ask over that 5-year period is $3.1 billion. The first one is 1.8 billion relates to renewing and replacing aging infrastructure."

The same presenter noted that aging cable is a major driver: "Cable in our system can be 40, 50, 60 years old. When it gets that old, you tend to lose its ability … on insulation and you get what are called cable burnoffs."

For Hamilton, the presentation cited $58.7 million in 2025 spending and $52 million planned for 2026, with more than $600 million projected over the five-year period. Listed projects included pole, transformer and switchgear replacement, new customer connections, underground cable work, automated switching devices and substation upgrades.

3. GROWTH PRESSURES: EVs, electrification and major projects

Council heard that electricity demand is expected to rise with electric vehicles, building electrification, transit projects and industrial growth. The presentation projected about 500,000 electric vehicles on the grid by 2031, 150,000 new customer connections, and 200 megawatts of new load growth in Hamilton.

Projects referenced in Hamilton included downtown growth, Pier 10, industrial lands, the Metrolinx bus terminal and utility relocations tied to the Hamilton LRT.

Councillor Brad Clark asked, "how is Electra managing the demand for electricity given the the rise in electric vehicles, electrification, the mush sector, and now these high megawatt data centers? How how does Electra manage the demand?" In response, staff described planning around local adoption patterns and system constraints.

4. RATES AND CUSTOMER IMPACTS

The meeting heard that Electra's delivery charges remain below sector averages and below neighbouring utilities. A 3.3 per cent increase for 2025 was described as the approved annual inflationary adjustment.

Council was told the next rate application is scheduled for Jan. 1, 2027, covering the 2027-2031 period and subject to Ontario Energy Board review.

Andrea Horwath said broader provincial generation costs are also likely to affect bills: "Ontario Power Generation just refurbished four reactors at Darlington… they're now building small modular reactors… There's an anticipated expansion at Bruce," and "the commodity price of electricity will likely increase over the next five years."

The presentation also referenced a customer financial assistance program for electricity bill support.

5. FUNDING MODEL: possible municipal equity contribution

A major part of the discussion was how to finance future expansion while maintaining Electra's 60/40 debt-to-equity structure. Officials said that if the balance sheet grows, municipal shareholders may need to invest more equity.

Councillor Tammy Hwang asked how financing projections may change given "Bill 40 on securing affordable energy for generations" and "potential federal financing from the Canada Infrastructure Bank." She said, "all of this is changing the landscape in terms of financing."

Officials said a funding strategy is expected in the first quarter of next year, with options under consideration including provincial legislation, Canada Infrastructure Bank financing, rate relief, sale of non-regulated assets and holding company debt.

Motions

• Item 6.1 — Received by council vote, 11-0
• Approval of audited financial statements — scheduled to follow
• Auditor appointment — scheduled to follow
• Board appointments — scheduled to follow

Attendees

• Craig Cassar, Chair, Ward 12 Councillor
• Councillor Brad Clark
• Councillor Tammy Hwang
• Full council attendance was noted, with some members attending online