Residential customers conserved more energy in the first five months of the year compared to the same period 2005, according to the interim report released by Belco Holdings Ltd. on Friday.

Despite the addition of 582 new metered customers, Belco?s residential electricity sales were off 1.29 percent from the first five months of 2005. The electric company attributes the decline to milder temperatures and conservation efforts as a result of higher fuel adjustment costs.

Belco?s total kilowatt sales to May 31, 2006 were however 1.9 percent higher than the same period 2005 as a result of demand, or large commercial sales rising by 5.16 percent and small commercial sales increasing by 3.96 percent.

President and chief executive officer Garry A. Madeiros said that the company continues to focus on the construction of a permanent switchboard facility that will replace the buildings and equipment destroyed by fire on July 14 last year.

Belco expects to commission its new $10.7 million facility by the middle of the month.

Once completed, the new two-storey, 9,500 square foot, reinforced concrete building and a low-maintenance, state-of-the-art switchboard that incorporates industry best practices and safety standards will provide access to two of the three generators which were left stranded from the system.

?This restores plant operating capacity and ensures the overall security of electricity supply in time for summer?s peak electricity demands,? said Mr. Madeiros.

The third engine will be reconnected shortly thereafter, as work on the system continues.

Phase II of the project will progress through late 2007, and includes making further changes to the transmission and distribution network to enhance the security of supply to Hamilton and areas outside the City.

Belco is also continuing to spend time and effort on activities related to recommendations from reports on the fire that were commissioned by the BELCO Holdings Board of Directors and the Bermuda Government.

These include action items stemming from an audit of the BELCO protection system, a strategic review of the BELCO power system, as well as fire prevention and protection studies.

The company continues to present its Electric System Discussion Document, outlining energy options for the next 20 years.

Sixteen external groups as well as Belco employees and shareholders have reviewed the comprehensive document which examines the company?s options in light of such things as feasible resources, environmental considerations and greater conservation activity.

Belco is seeking consensus on the options it has for the best way forward as an energy provider.

Among them, BELCO could invest in generating sites away from its main Pembroke plant, partner with others to develop generation facilities elsewhere on the Island, or purchase power from independent producers.

The addition of a renewable component specifically the energy contribution BELCO expects to receive as a result of its recent agreement with Current to Current Bermuda Limited to purchase power generated by ocean currents is also being discussed. Sales at Bermuda Gas, which has moved to the Boyle?s Building on Church Street, were off 1.9 percent from the first five months of 2005.

Although gas sales for the period were 11.2 percent higher than last year as a result of continued higher gas prices, appliance sales had a slow start to the year, down 26.7 percent.

The company expects sales to improve with heavier volume of traffic in the new location. Service and parts revenues increased 6.3 percent, resulting from a significant number of construction projects.

CARILEC, an association of Caribbean electric utility companies, has just committed to hold its May 27-30, 2007 CEO Conference in Bermuda.

Mr. Madeiros said that the organisation was interested in coming to Bermuda partly because of his company?s agreement to purchase renewable energy generated by ocean currents from Current to Current Bermuda Limited.

At its 2006 Annual General Meeting, shareholders of BELCO Holdings Limited unanimously agreed to increase the Company?s share capital from 10 to 20 million shares.

The number of Company Directors remains at 14 and the existing Directors were elected on block.