The Cayman Islands Government has unveiled plans to address rising energy costs, driven by global fuel price spikes linked to ongoing geopolitical tensions.
Without intervention, the government said, residential electricity fuel charges are projected to jump more than 70%, from $0.14 per kilowatt-hour to as high as $0.24/kWh this summer.
The announcement came in a press release on 29 April amid forecast heatwaves this summer and pressure from opposition lawmakers to take action to reduce the escalating cost-of-living.
The government’s action plan is divided into three parts.
The first phase waives import duties on gasoline, diesel and propane from June to September and implements a residential electricity fuel cost charge cap of $0.18/kWh.
This is aimed at assisting nearly 90% of Caribbean Utilities Company (CUC) customers who consume between 101 kWh and 2,000 kWh per month.
These initiatives have an estimated cost of just under CI$9 million, divided between $4m in fuel duty waivers and $4.7m in electricity bill relief.
Earlier in the month, opposition member Roy McTaggart suggested the government temporarily eliminate import duties on fuel in an effort to control rising prices.
The People’s Progressive Movement (PPM) welcomed government’s decision to take this step in a press release on 30 April.
“The PPM has consistently advocated for targeted, meaningful measures to address the rising cost of living, and it is encouraging to see this issue now being acted upon,” it said.
Phase two of the plan, expected for 2027-2028, takes aim at improving home energy consumption efficiency by expanding the CHEER (Cayman Home Energy Efficiency Retrofit) programme.
This initiative supports roof insulation and air conditioning upgrades to permanently reduce household energy consumption.
Phase three, set to begin in 2027, would accelerate utility-scale solar power production to reduce Cayman’s dependence on diesel generation and vulnerability to oil price volatility.
“The NCFC Government is not willing to stand by while Caymanian families face soaring electricity bills caused by conflict on the other side of the world,” Premier André Ebanks said in a press release.
“We are acting before the summer bills arrive, not after.
“This is not simply a crisis response. It is the first step in a long-term plan to make Cayman’s energy system more efficient, more resilient and more affordable for every family.
“We are dealing not just with the symptoms, but with the root causes.”
Cost-of-living concerns
Ahead of the year’s fifth and final meeting of parliament, opposition lawmakers framed the cost of living as a leading issue affecting the Cayman community.
Deputy opposition leader Kenneth Bryan, speaking on Radio Cayman that morning, suggested the government return its projected surplus to the public to ease cost-of-living pressure, related in large part to higher fuel costs.
“The government has come out saying that they have a $43 million surplus,” Bryan told ‘For the Record’ host Orrett Connor. “It’s time to give the people back that money, simply put. They know that the cost of living is high.”
He pointed to the combined effect of rising global fuel costs, increases in Water Authority rates, and weather forecasting projecting a hot and dry summer for Cayman.
“This ripple effect from all of these government policies and the global circumstances make things look very bleak this coming summer,” Bryan said, suggesting that Caymanians will need to begin cutting back over the next six months.
Increased jet fuel costs, he added, would also affect operations by Cayman Airways.
Fellow opposition member Roy Tatum, also speaking on Radio Cayman, noted that increased import costs would result in greater duty collection by government, generating another opportunity to give back to the public.
Tatum has submitted two parliamentary questions regarding cost of living for this sitting.
One question seeks clarification on how the Middle East crisis has impacted Cayman’s economic outlook and if policy measures to address the cost of living have been identified as the result of trade diversification meetings.
