For the first time in its history, the Bermuda Electric Light Company will return $1.5 million in surplus revenue to its customers.

This gesture of goodwill is not unprecedented, according to Belco Holdings president and CEO, Garry Madeiros, who said rebates have been provided by utilities before in North America.

This one-time rebate will be credited to the March bills of customers representing the 30,000 metered connections. The bills start going out today.

The $1.5 million represents about one percent of $103 million in sales, or ten percent of profit for the 1996 year. The utility is on the verge of releasing details of a profitable financial year.

Mr. Madeiros cited a number of factors that led to a very successful, and exceptional, year of operation, including the lack of hurricane damage, the absence of major mechanical failures, improved efficiency, continued cost control and positive results in the negotiation of contracts.

"Over the years, it has been Belco's stated goal to not only improve our performance for the benefit of our shareholders, but to also look for ways to stabilise electricity rates for all of our customers,'' Mr. Madeiros said.

"This is the understanding which defines our relationship with the Price Control Commission and forms the basis for all of our submissions. The savings that we achieved in 1996 on our outside generation maintenance contracts and insurance premiums were a one-off benefit of $1.5 million.

"Therefore, in keeping with our stated position with the commission and our good performance in all areas of the organisation, we have decided to make this voluntary rebate to our customers.

"This underscores the type of relationship we have been trying to generate with our customers over the last few years. That relationship means that we will be honest with the public when we need money, and we will be honest when we've done extremely well and can give some back. It may not be a lot of money per family, but we think a lot of Bermudian families will appreciate getting something back.'' But Mr. Madeiros assured that there should be no need to raise electricity rates over the next two years. In fact, the company believes there will be significant growth in the Island over the next few years, after continued annual growth in sales in recent years.

Two thirds of the rebate will be distributed among residential customers at a rate of about a penny for every two kilowatts per hour used in 1996, while the remainder goes to corporate customers at the rate of a penny for every five kilowatts per hour used during last year.

By way of example, Mr. Madeiros said that a monthly user of 600 kilowatts per hour will receive a rebate of about $36.

He said residential customers received the lion's share of the rebate because commercial customers received a reduction in rates last year, while restructuring increased residential rates.

Belco officials thought long and hard before making the decision to return excess revenues to customers. Mr. Madeiros conceded there may be some cynics who question this policy, and would favour dropping the excess $1.5 million to the bottom line for the benefit of shareholders, or retaining the money for the annual purchase of new equipment.

He said: "People can say we should have used that money for undergrounding of our cables. But if we kept that money, I can see people saying Belco was charging too much for electricity. This was an unusual scenario to end up with additional revenues, based on certain specific factors. We thought it would be nice to give something back.''