Deal to sell Peterborough Distribution Inc. to Hydro One closing in August – ThePeterboroughExaminer.com

The deal to sell Peterboroughs electricity distribution system to Hydro One is set to close on Aug. 4, states a new city staff report and now city councillors have four new proposals to evaluate as they mull how to use the proceeds.

Councillors had previously considered banking the proceeds in a Toronto investment firm or backing its own renewable energy company, but now they can also think about four new ideas: creating a home energy retrofit program, creating a trust to support renewable energy projects, investing in a local bank or creating a stream of grants for local charities.

City council approved the sale of Peterborough Distribution Inc. (PDI) more than three years ago after a contentious debate. The deal was finalized in the summer of 2018 and approval from the Ontario Energy Board came in April.

PDI is the wires and poles distribution arm of Peterborough Utilities Inc., which will continue to exist as a power generation company.

The agreement to sell PDI to Hydro One includes the wires, poles and transformers of Peterborough Utilities, which delivers electricity to 37,000 customers in Peterborough, Lakefield and Norwood.

Although the sale price is $105 million, the city is expecting to receive somewhere between $50 million and $55 million once fees and debate are paid.

In a virtual meeting on Monday, councillors will discuss the idea of striking a new group made up of city staff plus three councillors (Andrew Beamer, Gary Baldwin and Dean Pappas) to review all options for use of the sale proceeds and make recommendations to council later.

Councillors will also vote Monday on a staff recommendation to invest 100 per cent of the sale proceeds and spend only the returns from the investment.

At a meeting earlier this year at City Hall, councillors heard two detailed pitches: one to place the money in a bank portfolio with the Toronto non-profit One Investment and the other to invest instead in renewable hydro and solar generation facilities of the municipally owned City of Peterborough Holdings Inc. (CoPHI) in a plan that would return dividends to the city.

But now the city has received four new proposals that merit consideration, states the staff.

Those new proposals include:

Alan Slavin, climate activist and physicist, suggests investing the sale proceeds but using the interest as homeowner loans for energy retrofits.

Fred Irwin, founding director of Transition Town Peterborough, suggests the creation of a trust fund to ensure theres money available to maximize local renewable power generation in the future.

George Ripoll, investment adviser at BMO Nesbitt Burns, suggests investing through a local bank with a Peterborough-based adviser rather than going with the Toronto-based non-profit ONE Investments.

The Community Foundation of Greater Peterborough suggests banking most of the sale proceeds but setting aside at least 20 per cent or $10 million for a new fund, with interest disbursed as grants for charities.

Although the sale closes Aug. 4, the report states that council may not have settled yet on a final plan by then and if thats the case, the money would be placed in a short-term investment.

Never miss the latest news from the Peterborough Examiner. Sign up for our email newsletters to get the day's top stories, your favourite columnists, and much more in your inbox.

PDI is a branch of Peterborough Utilities Inc., which was founded 105 years ago.

The previous councils decision to sell it wasnt popular with some residents who said at public meetings they didnt want the city to lose control of the asset because electricity rates could increase over time.

But CoPHI, which governs PDI, had advised council at the time that replacement of PDIs aging infrastructure would cost so much it would soon threaten the distribution systems viability and so the city was better off to sell.

joelle.kovach@peterboroughdaily.com

Read more:
Deal to sell Peterborough Distribution Inc. to Hydro One closing in August - ThePeterboroughExaminer.com