Toronto Hydro Profits Soar, Fueling $5.1B Grid Overhaul & Rate Hikes

TORONTO, ON – February 26, 2026 – Toronto Hydro Corporation has announced a significant surge in profitability for 2025, with net income climbing to $201.5 million. This represents a $71.2 million increase from the previous year, a financial upswing that the utility attributes primarily to newly approved electricity rates as it embarks on a massive $5.1 billion, five-year investment plan to modernize the city's aging power grid.

The year-end results, released Tuesday, paint a picture of a utility in a period of intense transition, balancing ambitious infrastructure projects and sustainability goals against the backdrop of rising costs for consumers and a renewed, solemn focus on workplace safety following a tragic employee death in 2025.

A Financial Surge and an Ambitious Overhaul

The utility's robust financial performance marks the first year of a new five-year rate period approved by the Ontario Energy Board (OEB). The increased distribution revenue was the main driver behind the 55% jump in net income compared to 2024. This financial strength is deemed essential by the company to fund its extensive capital program, which saw expenditures rise by 7.0% to $944.1 million in 2025 alone.

These funds are being directed toward a sweeping modernization of Toronto's electrical backbone. In 2025, the utility completed 471 investment projects, including the replacement or installation of nearly 3,500 poles, over 3,500 transformers, and hundreds of kilometers of new overhead and underground wiring. The work is part of a broader strategy to prepare the grid for a future where electricity demand is projected to more than double by 2050, driven by population growth and the widespread adoption of electric vehicles and heating systems.

This investment plan is designed to address several critical challenges simultaneously: renewing deteriorating infrastructure to prevent outages, adapting to new patterns of electricity use, and hardening the system against threats like extreme weather and cyberattacks.

The Price of Progress: Rate Hikes and City Finances

For Toronto residents and businesses, this progress comes at a direct cost. The OEB-approved rate structure that bolstered Toronto Hydro's bottom line is translating to higher electricity bills. Based on the utility's rate application, a typical residential customer was projected to see their monthly bill increase by approximately $3.24 in 2025, with further annual increases expected through 2029. Commercial customers face even steeper impacts.

While the provincial government increased the Ontario Electricity Rebate (OER) to 23.5% in late 2025, which helps mitigate the direct bill impact for many households and small businesses, it doesn't erase the underlying rise in distribution charges needed to fund the infrastructure work. The utility maintains that its funding is derived entirely from these rates paid by customers.

The financial relationship between Toronto Hydro and its sole shareholder, the City of Toronto, has also grown more complex. In the first quarter of 2026, the utility will pay a $10.0 million dividend to the city, providing revenue that can be used for municipal services. Conversely, the City of Toronto recently made a $25.0 million equity contribution to Toronto Hydro to bolster its financial stability and support its grid investments. This two-way flow of capital highlights the city's strategic interest in maintaining a modern and reliable utility, even as it benefits financially from its operations.

Powering a Greener Toronto

A significant portion of the capital investment is targeted at advancing Toronto's climate goals. The utility reported substantial progress on its sustainability targets, aligning its work with the City's TransformTO Net Zero Strategy. In 2025, Toronto Hydro reduced its direct Scope 1 emissions by over 15% compared to a 2019 baseline and electrified 33% of its vehicle fleet.

More visibly for the public, the company surpassed its 2023–2025 climate action targets, supporting the installation of over 15,000 electric vehicle (EV) chargers and more than 700 heat pumps. In a major milestone, Toronto Hydro and the Toronto Parking Authority energized the TPA's 500th public EV charging station in October.

These efforts earned the company external recognition; Corporate Knights ranked Toronto Hydro first among its peers for corporate citizenship in 2025. To further empower customers, the utility launched new services including free energy coaching for residents and an interactive online map to help developers identify areas with sufficient electrical capacity for new projects.

A Renewed Focus on Safety

Beneath the positive financial and operational headlines, the company is grappling with the aftermath of a workplace tragedy. The 2025 report acknowledges the death of a team member in a workplace incident, an event that has spurred a company-wide reinforcement of safety protocols. In response, Toronto Hydro states it has enhanced its overall safety culture and introduced new proactive safety programs for its employees.

While details of the incident remain confidential, the utility's public commitment underscores the inherent risks of the massive infrastructure work underway. The company has affirmed its dedication to learning from the incident and striving for continuous improvement in its safety practices to protect both its workforce and the public.

"2025 was a year of meaningful progress for Toronto Hydro," said Jana Mosley, President and CEO, in a statement. "We strengthened the safety, reliability and resilience of our electricity system, continued to modernize the grid to meet Toronto's growing and evolving needs, and delivered strong financial performance. As we look ahead to 2026, we remain focused on empowering our customers and ensuring the electricity system is ready to support a brighter and more electrified future for our city through operational excellence."