Consolidated Water Co Ltd’s Cayman Islands subsidiary, Cayman Water Company Limited, has secured a new 25-year licence to continue supplying potable water in Grand Cayman.
The agreement ends years of negotiations with the Utility Regulation and Competition Office (URCO) and its predecessor.
The licence takes effect on 1 August and establishes a new long-term regulatory framework for the company’s retail water operations.
It preserves Cayman Water’s exclusive right to produce potable water from seawater, distribute it and sell it within its licensed service area.
This includes Seven Mile Beach and West Bay, two of Grand Cayman’s three most populated areas.
Chief executive officer Rick McTaggart said in a press release that the agreement provides long-term regulatory certainty while maintaining the company’s exclusive operating rights.
“The granting of this new exclusive retail water license represents a significant milestone for Consolidated Water and our Grand Cayman customers,” said McTaggart.
“The license establishes a modern regulatory framework under the islands’ current laws and regulations.
“Most importantly it preserves our exclusive right to produce, distribute and sell potable water within our licensed service area, which supports our continued investment in world-class water infrastructure to serve our customers.”
The new licence will also reduce the cost of water for customers, according to the company.
“This new license is a win for our customers and the company,” continued McTaggart.
“Lower base water rates and energy cost recovery charges under this new licence will provide an approximately 6.5% reduction in the cost of water per gallon to our customers compared with the prior license.
“In turn, the company has gained the certainty of a new, modern license for the next 25 years which incorporates an annual water rate adjustment mechanism that has been retained from our previous license.”
Cayman Water has provided retail water service in Grand Cayman since 1973.
The company received a new concession from the Cayman Islands Government in February 2025 that maintained the terms of its previous licence while negotiations with URCO continued.
Under the new agreement, base water rates, monthly meter rental fees and certain other charges are set out in the licence, with annual adjustments to base rates and selected fees taking effect each 1 July after the licence begins.
Any adjustments will follow the licence’s rate cap adjustment mechanism and remain subject to URCO verification and approval.
Based on pro forma estimates, Consolidated Water said revenue would have been about US$2.1 million lower in 2024, $1.9m lower in 2025 and $0.6m lower in the first quarter of 2026 if the new base rates, energy cost charges and monthly meter rental fees had applied under historical operating conditions.
The company said the estimates are illustrative only, based on historical volumes, historical energy costs, historical meter base and other assumptions.
It said they do not reflect statutory or regulatory fees that have not yet been prescribed and are not necessarily indicative of future operating results under the new licence.
