demand and production, even though the company lost millions of dollars in revenue from the scaling back of the foreign military presence here.

And even though sales to hotels showed a marked improvement during the long hot summer, Belco will continue to diversify its holdings in the energy sector, Belco President and CEO Mr. Garry Madeiros said in an assessment of how the company has done this year.

"June's daily temperature high was five degrees higher than average. July's was about four degrees higher and so was August. It was such a hot summer that sales went out of sight. We experienced a record level of sales and demand for electricity this summer,'' Mr. Madeiros said.

"Initially, though, we didn't budget for that. It takes a minimum of three years from our planning to the bringing on line of a new engine. That's a gas turbine and it could be five years for a diesel.

"We were planning to have a new gas turbine in the summer of 1995. We had anticipated no growth in sales this year. And then in June things were really complicated for us when we lost our biggest engine, our slow-speed diesel, with a major mechanical failure.

"Those two factors provided a lot of difficulty. And you may remember, we had to ask for people to reduce energy consumption,'' he said.

Belco had anticipated an actual reduction in demand for electricity because of the departures of military personnel.

HMS Malabar is set to close, taking its $205,000 in annual electricity sales.

The $1.2 million worth of yearly electricity sales to the US Navy Annex have vanished. A lot of revenue from electricity sales there began to disappear in 1993, but it was non-existent this year.

The Canadian Base was using $550,000 worth of electricity, half of that used by the Canadian personnel in their homes.

There has meanwhile been a reduction of $550,000 from energy consumption at the naval air station at Kindley Field. The total sales to NAS Bermuda used to be about $3 million, and it has already been reduced to about $2.5 million.

"Now that won't go away completely, because you have air traffic control and a number of other things out there that will have to stay. But we're talking about a reduction in revenue of $2.3 million already in total.

"But you won't see in our financials this year a financial impact on lost revenue because the sales from the summer are so high. And some of that $2.3 million had already disappeared in the 1993 figures, like from the Annex.

"Other things have come on line to make up the slack. There have been new buildings. We were anticipating slow growth this year.

"And things were heating up in the tourism sector. There was a noticeable increase in sales to hotels, almost all the large ones.'' Belco has also made it clear that it is taking real steps to diversify. The recent purchase of Bermuda Gas & Utility was just the first step in a master plan that will begin to take shape in the coming year, as the company seeks to become a more varied energy company.

Mr. Madeiros would not provide specifics, but he did say, "It fits into our new direction of trying to be a total energy company. As we move into 1995, there will be other things that we will be looking to do, whether it be purchasing, or starting from scratch, other opportunities to increase our ability to be a total energy company. Our direction will be "Belco. Your partner in energy solutions.'' "That's the direction we will be going in addition to selling electricity.

They will all be related to energy and the provision of services that support energy.''