OfReg’s board of directors considered a rate adjustment submission by Water Authority-Cayman at its monthly meeting last week but deferred a decision pending the review of further information requested from the authority.
Under the law, the regulator must review and approve any proposed water rate increases.
The board’s review of the submission on 14 April found that the 2020 financial statements supporting the adjustment did not justify the need for an increase.
Peter Gough, interim CEO of OfReg, said it is the office’s responsibility to ensure fair prices for the consumer. That also meant that regulator must legally and impartially review and agree to any increases requested by operators and licensees.
“Therefore, we have directed the Water Authority to provide further information to support its submission, including its 2021 financial year statements and forecasted five-year Capital Investment Plan,” Gough said.
“As the independent regulator, OfReg takes its remit to ensure fair pricing and protect consumers extremely seriously. It is the view of the regulator in this case that consumers should not bear an unjustified water rate increase at a time when household budgets are already stretched,” he added.
Gough said, “We are fully aware of the impact of global fuel prices and the knock-on effects in Cayman on energy costs and the cost of living generally.”
According to the Economics and Statistics Office’s consumer price index report for 2021, the cost of water supply increased by 13.1% last year.
An energy adjustment factor is already added to the cost of metered water to account for fluctuations in the price of energy required to produce and distribute desalinated water.
OfReg said it would make a further announcement after reviewing the requested information.
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