Council forms group to review ideas for use of PDI proceeds

Councillors agree to invest all of the proceeds from sale to Hydro One and only spend the returns in the future

The deal to sell Peterborough’s electricity distribution system to Hydro One is set to close on Aug. 4 — and at a meeting on Monday, city councillors received four new proposals to evaluate as they mull how to use the sale 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.

In a virtual committee meeting on Monday, councillors didn’t make any decision: that’s expected to come later this year.

But they did give preliminary approval to form a new group made up of city staff plus three councillors (Andrew Beamer, Gary Baldwin and Dean Pappas) to carefully review all options for use of the sale proceeds and make recommendations to council later.

Councillors also gave preliminary approval on Monday to invest 100 per cent of the sale proceeds and spend only the returns.

Both plans need a final vote at a council meting June 22.

Pappas said the fact that the council will now carefully consider some new options for using the PDI proceeds, brought forward by the community, demonstrates council’s willingness to hear its citizens’ ideas.

“This shows council is listening to the community... There are many smart and knowledgeable people in our community and they’ve come up with ideas,” he said.

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 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 and $55 million once fees and debts are paid.

Although the sale closes Aug. 4, council may not have settled yet on a final plan yet — and if that’s the case, city staff suggests the money be placed in a shortterm investment.

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

The previous council’s decision to sell wasn’t popular with some residents who said at public meetings they didn’t 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 PDI’s aging infrastructure would cost so much it would soon threaten the distribution system’s viability and so the city was better off to sell.