Based on Hydro Ottawa website, it seems the 1.75% service fee is charged by Plastiq or Paymentus (not by Hydro Ottawa) when you used one of them to make credit card payment to Hydro Ottawa. I don't know why would anyone want to pay via them and gets charged 1.75%. You can make credit-card payment (without service fee) directly to Hydro Ottawa by calling 613-738-6400. As such, it is possible Canadian Tire MC is willing to be a payment provider for its clients without charging the 1.75% fee. I will give it a try when my next bill comes.
RFD has a post saying there's probably a bug with the account number length for Hydro Ottawa. It was added as a payee not long ago. This problem, once reported, should be corrected soon.