Toronto Hydro announced Monday that it has reduced dividend payments to the City of Toronto to $25 million per year, less than half of what it paid in 2015.
The dividend payments resulted from Toronto Hydro's need to invest in infrastructure to ensure the safety and reliability of the electricity grid and to keep up with the city's growing population, the utility said.
"Toronto Hydro is financially strong and needs to keep pace with infrastructure renewal, growth in the city and increasing electrification due to government policy changes," David Williams, chair of Toronto Hydro's board, said in a press release.
Toronto Hydro paid the city $56.25 million in dividends in 2015, according to that year's annual report. Since 2003, the utility says it has paid Toronto approximately $679.5 million in aggregate dividends.
Tory wants to 'unlock value' in utility
Toronto Mayor John Tory told CBC Radio's Metro Morning in September that city staff should continue to explore ways to "unlock value" in Toronto Hydro. However, in 2014, Tory criticized mayoral candidate Karen Stintz for suggesting that it should be sold.
Also in September, the mayor told the Toronto Region Board of Trade that he has directed city staff to "examine the whole question of how Toronto Hydro is structured and financed."
"I am in support of the city council's majority vote to explore ways to unlock value [in Toronto Hydro] ... and keep the utility in public hands," Tory said.
He added that Toronto must look at all options when it comes to paying for upgrades to the hydro grid, which he said is failing too frequently.
"The city needs to have that continuing dividend but the hydro also needs to invest hundreds of millions in their plants so they don't have power failures," Tory said.