Message from the Chair of the Board and President & Chief Executive Officer

On behalf of the Board of Directors of Hydro Ottawa Group, our management and employees, we are pleased to provide this 2024 Annual Report to our shareholder, the City of Ottawa. This marks our fourth progress report under our 2021-2025 Strategic Direction.

Following two exceptionally challenging years, 2024 marked a momentous rebound. In 2022 and 2023 we endured multiple body blows – historic severe weather events, high inflation and interest rates, and a labour strike. But those hits were not knockout punches. Instead, we remobilized, leaned in, and drew upon our employees’ depth of resilience and dedication. The upshot was not just a single year of robust results, but a sharper, tougher organizational posture that makes us fit for purpose in terms of capitalizing on future opportunities.

Do not delete this. It creates the green parallelogram.

Generating value through strong returns and fortifying our financial capacity

In 2024, our core business lines performed well, with favourable topline metrics across the board. Year-over-year revenue (excluding power recovery) increased 17 per cent (from $333 million to $389 million), resulting in net income of $42.1 million. This will translate into a dividend payment of $22.3 million to our shareholder.

Each of our main lines of business reached a significant milestone last year. In electricity distribution, we delivered the highest-ever capital investment in our grid, with $89.1 million directed to replacing aging infrastructure and adding system capacity, and another $68.5 million to connecting new customers and supporting municipal infrastructure projects. In renewable generation, we produced a record volume of clean electricity across our 36 stations thanks to upgrades at our hydroelectric plants and the optimization of water flows. With growing demand for its services and expertise, our energy solutions business experienced 95 per cent revenue growth relative to 2023. Meanwhile, our recently launched telecommunications subsidiary completed its first full year of operations, making early headway in signing-up customers.

Alongside these accomplishments, we took important steps to ensure that our long-term financial health remains rock solid. As of October 2024, a new corporate structure was put in place. New holding companies were situated beneath the parent company and responsibility for debt issuance was transferred to one of these new entities. This action provided an immediate benefit to our credit rating. Just as importantly, it put us on a stronger path towards executing the massive infrastructure investment program on the horizon and continuing to expand our business activity. Restructuring was a major initiative, requiring separate approvals from our shareholder, bondholders and regulator. We are grateful to all parties for their support and helping to create the conditions for future growth and diversification.

Do not delete this. It creates the green parallelogram.

Delivering the energy transition

Across the globe, the energy systems which fuel our economy and power our way of life are undergoing an unprecedented transformation, shifting away from fossil fuels to clean electricity. As our customers stand to benefit tremendously from this switch, we are committed to playing our part in bringing it about.

On this front, 2024 featured noteworthy progress, foremost on signature green energy projects in our community. As lead partner for the City of Ottawa’s flagship project to phase-out diesel buses in favour of a fully electrified fleet, we finished installing the first tranche of EV infrastructure and initiated the development of a new electrical substation guaranteeing dedicated capacity for bus charging.

Additionally, we achieved forward movement on the design of the energy-efficient, low-carbon central utility plant which will sustainably power The Ottawa Hospital’s new Civic campus. We also advanced key partnerships on energy savings and carbon reduction with the Ottawa Airport, Ottawa Community Housing, and school boards in Renfrew County.

Alongside our participation in these high-visibility, high-impact ventures, we sought to maximize the reach of our solutions and expertise to a wide range of stakeholders. For example, we were honoured to be selected as the delivery agent for $10 million in federal funding through our Ottawa Retrofit Accelerator program, which will assist local building owners in reducing their emissions and energy costs. We likewise facilitated the installation of more than 440 EV charging stations across our community as well as a 70 per cent increase in the number of homes generating their own electricity with rooftop solar.

Do not delete this. It creates the green parallelogram.

Helping our communities thrive

As a municipally-owned company, it is our responsibility and privilege to build goodwill and trust with everyone who lives, works, and plays in the communities in which we operate. Making good on this promise took many forms in 2024.

It involved lending a hand-up to our neighbours in need, through the contribution of nearly $370,000 in employee giving and corporate donations to local community partners like The Royal Ottawa Mental Health Centre and United Way East Ontario. It also featured outstanding performance in maintaining the reliability of our grid, with our best-ever results in minimizing outage frequency and the lights kept on for customers an average of 99.98 per cent of the time. Furthermore, against the emerging backdrop of heightened economic risks to Canadian producers and exporters, we were pleased to support community-based suppliers, spending $87.5 million on locally-sourced goods and services.

A new name, a changing landscape and a steadfast mission

In reading this message and perusing these pages, our readers will notice a small but important word change. In conjunction with the release of this report and its presentation to our shareholder, we are introducing Hydro Ottawa Group as our new, refreshed brand identity.

Why this? Why now? To begin, it affirms our evolution into a diversified energy provider and the foundation for success that we’ve laid through the pillars of innovation, sustainability, and community.

But even more than where we’ve come from, the name is about where we’re going. The accelerating pace of change in our business environment is giving rise to a host of opportunities for empowering our customers through the delivery of sustainable energy solutions.

Our new branding—Hydro Ottawa Group—is an intentional reflection of how customers and community are integral to the success of the energy transition. This invigorated sense of identity and purpose will sharpen our competitive edge as we turn our sights towards renewing our business strategy for the 2026-2030 period.

Amidst this change, our customers and stakeholders can remain assured of one constant ‒ the commitment of Hydro Ottawa Group to our community and to service excellence. We take great pride in our 100-year legacy of enabling prosperity and progress. We look forward to sustaining this tradition under a new banner as we continue the journey to a smart energy future.

Bernie Ashe

Chair, Board of Directors

Our customers and stakeholders can remain assured of our commitment to service excellence and our community.

Bryce Conrad

President and Chief
Executive Officer

We look forward to sustaining our 100-year legacy of enabling prosperity and progress, as we continue the journey to a smart energy future.