Hut 8's Ontario Power Plants Secure Long-Term Contracts, Stock Soars

Hut 8 Corp. HUT saw its stock edge higher during premarket trading on Wednesday after announcing a key infrastructure win in Ontario.

The company revealed that its joint venture, Far North Power Corp., formed alongside Macquarie Equipment Finance Ltd., a subsidiary of Macquarie Group, has secured new five-year capacity agreements for all four of its Ontario-based natural gas power plants.

These long-term deals come via the Ontario Independent Electricity System Operator (IESO), following a successful showing in the Medium-Term 2 (MT2) capacity auction.

Also Read: Hut 8 Locks In Lower Borrowing Costs With Fixed-Rate Coinbase Facility

According to Benzinga Pro, HUT stock has gained over 18% in the past year. Investors can gain exposure to the stock via Schwab Strategic Trust Schwab Crypto Thematic ETF STCE.

The awarded contracts cover power plants located in Iroquois Falls, Kingston, Kapuskasing, and North Bay, with a total combined capacity of 310 megawatts.

Set to begin in May 2026, these agreements are designed to provide fixed daily capacity payments, averaging CAD $530 per megawatt for the first year.

The contracts also allow for adjustments tied to inflation, potentially increasing payments over time.

By locking in these capacity commitments, Hut 8 and Macquarie aim to transition the power assets from short-term seasonal revenue models to more predictable long-term earnings.

The contracts ensure consistent cash flow and reduce exposure to volatility in the energy market.

"Securing these contracts is a testament to the commercial and regulatory fluency of our power-native team," said Asher Genoot, CEO of Hut 8.

Joshua Stevens, Managing Director at Macquarie, emphasized the strategic relevance of these plants in Ontario's increasingly constrained electricity grid, calling the contracts a vote of confidence in Far North's long-term value.

Ontario is projected to see a sharp rise in electricity demand, with IESO forecasting a 75% increase by 2050 and a 5.8 GW shortfall by 2030. These forecasts suggest ongoing reliance on dispatchable assets like Far North's gas-fired plants, adding further upside potential through energy sales.

Price Action: HUT shares are trading higher by 4.44% to $19.30 premarket at last check Tuesday.

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