Consolidated Water Co. Receives Long-Term License for Grand Cayman Operations

On June 24, 2026, Consolidated Water Co. Ltd. (NASDAQ: CWCO), a prominent designer, builder, and operator of advanced water treatment facilities, announced a pivotal development for its retail water subsidiary, Cayman Water Company Limited. The company has been granted a new 25-year exclusive retail water license by the Utility Regulation and Competition Office of the Cayman Islands (OfReg). This license allows Cayman Water to provide potable water services to customers in designated areas of Grand Cayman, including the highly populated regions of Seven Mile Beach and West Bay.

The new license, set to commence on August 1, 2026, establishes a contemporary regulatory framework aimed at enhancing the operational efficacy of the company's retail water services. Following extensive negotiations with OfReg, this licensing agreement is seen as a significant milestone for both Consolidated Water and the residents of Grand Cayman.

Rick McTaggart, CEO of Consolidated Water, stated, “The granting of this new exclusive retail water license represents a significant milestone for Consolidated Water and our Grand Cayman customers.” He emphasized that the license not only preserves the company’s exclusive rights but also supports ongoing investments in high-quality water infrastructure.

One of the most notable aspects of the new license is its potential financial benefit to customers. The agreement introduces lower base water rates and energy cost recovery charges, which are expected to reduce the cost of water per gallon by approximately 6.5% compared to the previous license. McTaggart highlighted that this new regulatory framework offers both the company and its customers a win-win situation, ensuring stable pricing while safeguarding the company’s long-term operational viability.

Under the terms of the new license, Cayman Water will have the ability to adjust its base rates on an annual basis, following a mechanism retained from its previous licensing agreement. This adjustment will be subject to verification and approval by OfReg, providing a level of regulatory oversight that aims to balance the interests of consumers and the utility provider.

Cayman Water has a rich history, having provided retail water services in Grand Cayman since 1973. The company had recently secured a concession from the Cayman Islands government in February 2025, allowing it to operate under the terms of its prior license while negotiating the new agreement with OfReg.

Financially, the company has projected that if the new rates had been in effect in previous years, revenues for 2024, 2025, and the first quarter of 2026 would have been approximately $2.1 million, $1.9 million, and $0.6 million lower, respectively, compared to the previous rate structure. These figures, however, are illustrative and based on historical data, and do not account for yet-to-be-determined statutory or regulatory fees.

The timing of this license is particularly fortuitous as Grand Cayman continues to experience a surge in tourism, which is a critical driver for retail water sales. Recent statistics from the Cayman Islands Government indicate that March 2026 saw a record number of 64,213 stayover visitors, marking the first time in history that stayover visitation exceeded 60,000 in a single month. April 2026 also posted impressive numbers, with 47,884 visitors, representing a 12% increase from April 2025.

Consolidated Water typically sees higher water sales in the first half of the year, coinciding with increased tourism and drier weather conditions. While forecasts suggest the possibility of hotter temperatures and reduced rainfall during the wet season, company management believes that robust tourism demand, coupled with increasing business activity and potentially drier conditions, will foster a favorable environment for retail water sales in the coming months.

The new exclusive retail water license represents a significant achievement for Consolidated Water Co. Ltd. as it positions itself for sustained growth and enhanced customer service in Grand Cayman. With favorable market conditions and a commitment to infrastructure investment, the company is poised to navigate the challenges and opportunities that lie ahead in the water utility sector. Further details regarding the license and its implications can be found in the Form 8-K filed with the U.S. Securities and Exchange Commission.