It is my opinion that Canadian utility stocks rarely generate the same excitement as AI names or high-growth tech plays, but they continue to play an important role in long-term Canadian portfolios. In 2026, that stability is becoming attractive again as interest rates trend lower and investors shift back toward dependable dividend income. Utilities also benefit from highly predictable cash flow, regulated business models, and infrastructure assets that are extremely difficult to replicate. For Canadian investors focused on passive income and lower volatility, the TSX utility sector still offers several strong long-term opportunities.
Here are five Canadian utility stocks worth watching right now.
#5. Capital Power Corporation (CPX)
Approximate Share Price: ~$70
Approximate Market Cap: ~$11 billion
Approximate Dividend:~3.9%
Sector: Power Generation & Utilities
Why It’s On This List
Capital Power has quietly become one of the more interesting utility names on the TSX because of its transition toward lower-emission power generation and expanding North American footprint. The company continues investing heavily in natural gas generation, renewable projects, and grid reliability infrastructure. Rising electricity demand tied to AI data centers and industrial electrification is also creating long-term tailwinds for power producers across North America. Unlike many slower-moving utilities, Capital Power still offers a reasonable blend of dividend income and moderate growth potential.
Competitive Advantage
Capital Power benefits from diversified power assets across multiple jurisdictions and long-term contracted revenue streams that improve earnings visibility. Its ability to balance traditional generation with renewable expansion gives the company flexibility as energy markets evolve. The company also has meaningful exposure to Alberta’s power market, where pricing can become highly favorable during periods of strong demand.
Financial Snapshot
Capital Power continues generating healthy free cash flow and has maintained a solid dividend growth profile over the past several years. Management remains focused on disciplined capital allocation while expanding EBITDA through new projects and acquisitions. The dividend yield remains attractive for income-focused investors at roughly 3.9%+.
The Bear Case
The biggest risk is execution around large infrastructure projects and evolving environmental regulations. Higher debt costs could also pressure returns if interest rates remain elevated longer than expected.
#4. Emera Incorporated (EMA)
Approximate Share Price: ~$73
Approximate Market Cap: ~$22 billion
Approximate Dividend:~4%
Sector: Regulated Utilities
Why It’s On This List
Emera continues benefiting from its highly regulated utility operations across Canada, the United States, and the Caribbean. As investors look for reliable defensive sectors in a potentially slowing economy, Emera’s predictable earnings profile and strong dividend history stand out again in 2026. Lower interest rate expectations have also improved sentiment toward utilities broadly. The company’s investment pipeline tied to grid modernization and cleaner energy infrastructure remains a key long-term growth driver.
Competitive Advantage
Emera’s biggest advantage is the stability of its regulated asset base. Most of its earnings come from regulated operations, which helps reduce volatility compared to more cyclical energy businesses. Its geographic diversification also helps lower operational risk while supporting recurring revenue generation.
Financial Snapshot
Emera continues producing stable cash flow and maintains one of the more attractive dividend yields among large Canadian utility stocks at roughly 4%–5%. The company has also maintained a long track record of dividend increases, which remains appealing for passive income investors building retirement portfolios.
The Bear Case
Emera still carries meaningful debt levels due to its capital-intensive infrastructure model. If borrowing costs remain stubbornly high, future earnings growth could slow.
#3. Hydro One Limited (H)
Approximate Share Price: ~$56
Approximate Market Cap: ~$34 billion
Approximate Dividend:~2.5%
Sector: Electricity Transmission & Distribution
Why It’s On This List
Hydro One continues benefiting from Ontario’s growing electricity demand and major infrastructure investment cycle. Electrification trends, EV adoption, population growth, and industrial expansion are all increasing pressure on Ontario’s power grid. That creates a favorable long-term environment for transmission and distribution companies. Hydro One may not be flashy, but its regulated business model provides extremely dependable cash flow generation.
Competitive Advantage
Hydro One controls one of the largest electricity transmission networks in Canada. These assets are incredibly difficult to replicate and operate under highly regulated frameworks that provide revenue visibility. The company also benefits from its dominant position within Ontario’s electricity infrastructure system.
Financial Snapshot
Hydro One continues generating consistent earnings growth supported by regulated rate increases and infrastructure investment approvals. Its dividend yield is lower than some peers at roughly 2.5%–3%, but the company offers strong balance sheet quality and defensive characteristics that many conservative investors appreciate.
The Bear Case
Because Hydro One operates in a tightly regulated environment, political and regulatory decisions can impact profitability and future rate approvals.
#2. Fortis Inc. (FTS)
Approximate Share Price: ~$75
Approximate Market Cap: ~$40 billion
Approximate Dividend:~3.1%
Sector: Regulated Utilities
Why It’s On This List
Fortis has become one of the premier long-term dividend compounders on the TSX. The company owns regulated utility assets across Canada, the United States, and the Caribbean, giving it exceptional earnings stability. In a market environment where investors are increasingly prioritizing predictable cash flow again, Fortis continues standing out. Its multi-year capital investment plan tied to grid modernization and energy infrastructure should continue driving gradual earnings growth through the rest of the decade.
Competitive Advantage
Fortis operates almost entirely regulated utility businesses, creating highly predictable recurring revenue. The company’s scale, geographic diversification, and conservative management style have helped it build one of the strongest reputations in the Canadian utility sector.
Financial Snapshot
Fortis is best known for its elite dividend growth track record. The company has increased its dividend annually for more than 50 consecutive years. Cash flow remains stable, payout ratios remain manageable, and management continues guiding for steady long-term earnings growth.
The Bear Case
Fortis is widely viewed as a premium-quality utility stock, which means the valuation occasionally becomes stretched during defensive market rotations.
#1. Canadian Utilities Limited (CU)
Approximate Share Price: ~$51
Approximate Market Cap: ~$14 billion
Approximate Dividend:~3.5%
Sector: Diversified Utilities
Why It’s On This List
Canadian Utilities remains one of the most dependable passive income stocks on the TSX. The company benefits from a highly diversified utility and infrastructure portfolio that includes electricity, natural gas, pipelines, storage, and industrial energy assets. In 2026, the combination of stable regulated operations and growing infrastructure demand continues supporting earnings consistency. For investors prioritizing dividend reliability above all else, few Canadian companies can match Canadian Utilities’ long-term track record.
Competitive Advantage
Canadian Utilities is backed by the broader ATCO group of companies and operates essential infrastructure assets that generate highly recurring revenue. Its regulated operations create predictable earnings while its infrastructure exposure provides additional growth opportunities tied to long-term energy demand.
Financial Snapshot
Canadian Utilities is one of Canada’s premier dividend aristocrats and has increased its dividend for more than five decades consecutively. The stock currently offers a dividend yield around 3.5% and continues generating dependable cash flow even during weaker economic environments.
The Bear Case
Growth tends to be slower compared to more aggressive utility or infrastructure companies. Investors looking for rapid capital appreciation may find the stock too conservative.
Final Thoughts
Canadian utility stocks are regaining attention in 2026 as investors position for lower interest rates, economic uncertainty, and rising demand for dependable passive income. The broader sector continues benefiting from electrification trends, infrastructure spending, AI-driven power demand, and grid modernization projects across North America. While utilities may not deliver explosive upside, they can play an important role in building long-term portfolio stability. For Canadian investors focused on dividend income, lower volatility, and steady long-term compounding, these TSX utility stocks remain worth serious consideration over the next 12 months.
