13 Caribbean Utilities Company, Ltd.  2011  Annual Report Management’s Discussion and Analysis Capitalised (“GEC”) (see Note 1 of  the Notes to Financial Statements).  GEC totalled $2.9 million for Fiscal  2011, $0.7 million higher than $2.2  million for Fiscal 2010. The Company  capitalises certain overhead costs  not directly attributable to specific  capital assets but which do relate  to the overall capital expenditure  programme. MW unit was taken out of service due  to a major mechanical failure and has  not been placed back in service. This  unit was near the end of its estimated  useful life and as at December 31,  2011 an economic analysis was in  progress to determine if the unit  should be repaired or retired. The  cost of the repairs for both units is  covered by the Company’s insurance  policy subject to the deductible (see  “Insurance - Terms & Coverage”  in the  “Business Risks”  section for greater  detail). 2011. Certain upgrades to generating  units are considered capital in nature  as the upgrades extend the life or  increase the output of the unit.  The Company currently has an  installed generating capacity of  151.23 MW and in addition to this had  installed 15 MW of leased temporary  generation capacity for the summer  to facilitate on-going planned  generator maintenance and repairs. Of this leased capacity 12 MW have  been returned and 3 MW remains  in service. The rental cost for the  temporary generation totalled $1.6  million in 2011. This cost has been  covered by the Company’s property  and machinery breakdown insurance.  The temporary generation costs are  not included within maintenance or  any operating expenditure line item  (see  “Generator Failures and Insurance  Claim”  table on page 18). In accordance with the Licences,  when an asset is impaired or disposed  of before the original estimated useful  life, the cost of the asset is reduced  and the net book value is charged  to accumulated depreciation.This  treatment is in accordance with rate  regulated accounting and differs  from the GAAP treatment of a loss  being recognised on the statement  of earnings. The amount charged to  accumulated depreciation is net of any  proceeds received in conjunction with  the disposal of the asset. This amount  within accumulated depreciation is to  be depreciated as per the remaining  life of the asset when the unit is placed  into service. In the case of the 16 MW  unit, which was taken out of service  in October 2010, insurance proceeds  will be applied to accumulated  depreciation and as the asset is  refurbished the costs incurred will be  capitalised. CS expenses for Fiscal 2011 totalled  $1.6 million a decrease of $0.1  million, or 6%, from CS expenses  of $1.7 million for Fiscal 2010. The  decrease was the result of lower  customer claims in 2011. T&D expenses for Fiscal 2011  totalled $2.0 million a decrease of  $0.2 million, or 9%, when compared  to $2.2 million for Fiscal 2010. This decrease was partially due to  increased capitalised labour as the  T&D Division focused on capital  projects and partially due to efforts to  control discretionary costs.  Depreciation expenses for Fiscal  2011 were $20.6 million, an increase  of $0.6 million, or 3%, from $20.0  million for Fiscal 2010. Depreciation  expenses increased as a result of  growth-related additions to fixed  assets in prior periods.  In October 2010 the temporary  cessation of depreciation on a 16  MW unit began and the temporary  cessation of depreciation on a 7.59  MW unit began in March 2011. The 16  MW unit was taken out of service due  to an overspeed failure and placed  back in service in July 2011. The 7.59  Maintenance expenses for Fiscal  2011 totalled $7.6 million, a decrease  of $0.7 million from $8.3 million for  Fiscal 2010. Maintenance expenses for  Fiscal 2011 were expected to be lower  than those seen in Fiscal 2010 due to  the cyclical nature of the maintenance  schedule resulting in various capital  projects being scheduled in Fiscal  Finance charges for Fiscal 2011  totalled $8.7 million, a decrease  of $0.4 million from $9.1 million  for Fiscal 2010 largely due to an  increase in the amount of finance  costs capitalised as Allowance for  Funds Used during Construction  (“AFUDC”). Amortization represents the  monthly recognition of the expense  associated with software purchases  as well as other intangible assets  such as the costs associated with  the licence negotiations. The licence  negotiations ceased in 2008 and the  costs associated with the negotiations  are being amortized over 20 years on  a straight-line basis. Amortization of intangible assets  for Fiscal 2011 totalled $0.3 million,  comparable to $0.3 million for Fiscal  2010. Consumer Services (“CS”) Transmission and Distribution  (“T&D”) Amortization Depreciation of Property, Plant  and Equipment (“Depreciation”) Maintenance Other Expenses and Income