The Ontario Energy Board has approved Hydro One’s purchase of the business and distribution assets of Peterborough Distribution Inc. from the City of Peterborough for $105 million.
On Thursday evening, the city announced the OEB approved the deal, which includes an agreement by Hydro One to invest in a new operations centre and fleet maintenance facility for Peterborough and area.
City council approved the sale of PDI in December 2016 by a 6-5 vote which came following months of public meetings with many opposing the sale. In 2018 Hydro One announced a deal had been struck, pending approval from the OEB.
PDI , founded more than a century ago, is the electricity distribution company of the Peterborough Utilities group of companies. The City of Peterborough is the sole shareholder of City of Peterborough Holdings Inc. (COPHI) which is the parent company of Peterborough Utilities.
The city decided to sell PDI following advisement from COPHI which said replacing PDI’s aging infrastructure would become too costly and threaten the viability of the system and that selling was the better option.
The city says the agreement includes a one per reduction in base distribution rates for PDI electricity customers plus a five-year rate freeze followed by increases aligned with inflation for years six to 10, subject to OEB approval of rates.
“Hydro One’s purchase of PDI brings new investments and combines the City’s electricity distribution network with Hydro One’s substantial presence in the broader Peterborough region to bring value and enhance service,” stated Mayor Diane Therrien.
“The City looks forward to working with Hydro One on its planned construction of a new regional operations centre and fleet maintenance facility in Peterborough, once the deal has closed.”
PDI workers will receive offers for employment with Hydro One with a 12-month service and location guarantee and recognition of past service for seniority purposes.
“We look forward to welcoming our new customers and employees to the Hydro One family,” stated Mark Poweska, Hydro One’s president and CEO.
“This strong partnership will energize life in the City of Peterborough for years to come through our continued investment in exceptional customer service, safe and efficient operations, and community initiatives.
“We would like to thank the City of Peterborough and the PDI team for their dedication and partnership.”
PDI serves approximately 37,000 customers in the City of Peterborough and villages of Lakefield and Norwood.
After debt and other liabilities related to PDI, the City is expected to receive $50 million to $55 million from Hydro One’s purchase of PDI.
The city says council is considering how to invest the revenue as part of its 2021 budget process, including options such as creating a Legacy Fund for long-term returns to the community and re-investing in Peterborough Utilities to support renewable energy projects with ongoing returns on the investment.
The OEB’s full decision can be found online.
Also on Thursday, the OEB approved the sale of Orillia Power Distribution Corporation to Hydro One for $41.3 million.
Comments