Hydro Ottawa is currently experiencing a significant surge in power demand from large clients, particularly data centers, creating what CEO Bryce Conrad describes as “extraordinary pressure” that is projected to continue increasing. The company is now fielding requests for 34 major projects requiring a total of 1,075 megawatts, equivalent to 86% of Hydro Ottawa’s average system load in the previous year.
Conrad highlighted that this demand level is the highest in the company’s history, with most of the projects seeking connections within the next two years. He anticipates that by the end of the current year, the total requests for connection will surpass the current power usage by residents and businesses in Ottawa.
Approximately 60% of the power demand comes from data centers, with a focus on smaller companies engaged in generative AI rather than major hyperscalers like Amazon or Microsoft. Furthermore, government clients, including those in national defense, are also seeking substantial power connections.
However, Hydro Ottawa is encountering delays in establishing these connections due to disruptions in the supply chain, resulting in extended wait times for essential equipment such as transformers. This situation is exacerbated by competition with larger U.S. entities for the same resources.
Despite the challenges, Conrad views the heightened demand as a positive indicator of Ottawa’s growth and economic activity. He emphasized the need for infrastructure expansion and modernization to support this growth effectively.
In response to the increased demand and infrastructure requirements, Hydro Ottawa is planning to double its capital investments over the next five years compared to the previous cycle. Conrad defended the utility’s recent rate hike, asserting that it is necessary to sustain competitiveness and support the necessary investments.
He criticized the rate application process, citing delays and inefficiencies that cost the company time and resources. Nevertheless, Hydro Ottawa remains financially robust, paying a substantial dividend to the city this year while outperforming the TSX as an investment.
While acknowledging the high service reliability of 99.97%, Conrad assured that the company continuously aims to minimize power outages and swiftly restore service in the event of disruptions. Council members commended Hydro Ottawa’s efforts, though some expressed concerns about reliability issues.