Question-and-Answer Session
Operator
(Operator Instructions) Thank you and our first question will come from the line of Danielle Seitz with Seitz Research Group.
Danielle Seitz - Seitz Research Group
Thank you. I was wondering if you are looking at cost productions in some of your businesses or should we look at the trend of operating cost as normal for the year?
David McClanahan
Good morning, Danielle. I think I would necessarily try to take the first quarter and use that as a trend. As you know, there’s always noise in looking at just one quarter. We are trying to hold the line on expenses. As you also know I’m sure, about 60% of our costs are labor and benefits and we don’t have any significant changes planned there, but we absolutely are trying to control expenses where we can, delay expenditures that aren’t absolutely necessary at this time, so we’ve got our eye on that ball.
Danielle Seitz - Seitz Research Group
Great, thanks.
Operator
Our next question will come from the line of Lasan Johong with RBC Capital Markets.
Lasan Johong - RBC Capital Markets
Hi. Could you give us an understanding of how much this conservation issue is bearing down on your numbers? Is it most of the difference; is it a very small portion and how do you know that this is actually happening?
David McClanahan
Good question Lasan; we’re obviously focused on it. As I said, about $18 million of revenues were lost from reduced usage. Probably about $3 million or $4 million of that is related to our commercial and industrial class. We’ve seen along the ship channel some cutback by our big industrial users and we have demand ratchets and overtime that ratchets down a little.
The other side, $13 million, $14 million is in fact in the residential class and we can explain part of that with weather, but not all of it with weather. This winter, we had fewer HDD days, heating degree days, but we can’t say they were of a different quality because it was a very dry winter and we had lots of kind of space between cold days and we tend to not have as much heating load as a result of that; but I would say that at least half of it is conservation related and it could be a little bit more.
The first quarter is not a good time to be trying to draw any conclusions on the electric side, because that’s not our largest load time as you know. Beginning late in the second quarter and then the third quarter are the times that we have our biggest electric sales and that’s what we’re really focused on.
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