The CI$0.18 cap on residential electricity fuel charges will run to 31 December, Cabinet has decided. The Cayman Islands Government announced on Monday 28 September 2026 a three-month extension of the Fuel Relief Programme from 1 October, two days before the duty waiver and the cap on electricity fuel charges were due to expire. The extension keeps the 100% import duty waiver on gasoline, diesel and propane, keeps the residential fuel charge cap at CI$0.18 per kWh, and widens who qualifies: customers using between 101 and 3,500 kWh a month are now eligible for relief on their first 2,000 kWh, which the Government said covers nearly 95% of households across the three islands, against nearly 90% under the April scheme. The previous ceiling was 2,000 kWh, and the Government said the wider band was introduced for multi-generational households, larger families and residents who rely on medical equipment at home.

The decision comes with money the Government had not budgeted. Cabinet approved a further CI$3 million in supplementary funding for the Electricity Assistance Programme, which Minister for Finance and Economic Development Rolston Anglin MP will report to Parliament as an exceptional-circumstance transaction under the Public Management and Finance Act, with the appropriation change to follow in a Supplementary Appropriation Bill. The release also gave the first outturn figures for the programme. Between 1 June and 31 August 2026, the Government said, support totalled approximately CI$11.35 million: CI$3.92 million in rebates paid to Caribbean Utilities Company, Ltd. (CUC) and Island Energy Ltd. for residential electricity relief, and CI$7.43 million in import duty forgone on gasoline, diesel and propane. When the programme was announced on 29 April 2026, the Government estimated the combined cost of the duty waiver and the cap for June to September at approximately CI$9 million, made up of CI$4.7 million for electricity relief and CI$4 million for the duty waiver. The April plan put the household saving at up to CI$105 a month for an average household using 1,750 kWh, and up to CI$120 at 2,000 kWh in July, the peak month. Nickolas DaCosta MP, then acting minister for finance, said in the April release that the CI$0.18 figure was "grounded in a decade of historical data".

What the Extension Is Worth

What the extension is worth to a household depends on a number CUC has not yet published. The Government's release said that at the September 2026 fuel cost rate of CI$0.2255 per kWh, the cap and the waiver together save around CI$70.44 a month on 1,200 kWh of use. For CUC's stated 2025 average customer, using 1,158 kWh a month, the cap alone is worth CI$52.74 against the September rate on the October bill. The November bill will carry a higher rate. "The October fuel cost rate has been calculated and provided to the regulator for review and approval," Jessica Pawlik, CUC's Manager, External Communications, said in an emailed response to The Caymanian Journal (TCJ) on 23 September 2026. "Our calculations indicate an increase in the October fuel cost rate when compared to September."

The Two-Month Lag

The timing of the extension matters because of how slowly fuel prices reach a Cayman bill. CUC said its fuel costs are billed on a two-month lag: fuel burned in one month is used to calculate the rate in the following month, submitted to the regulator, applied to consumption in the month after that and billed the month after that. On that account the October rate reflects fuel burned in August, and fuel burned in September feeds the November rate, billed in December. September was the month U.S. diesel set its record. The U.S. Energy Information Administration reported U.S. retail diesel at US$6.29 per gallon on 14 September 2026, the highest figure since its weekly series began in 1994 and, adjusted for inflation, the highest since 2022. The agency attributed the rise to elevated crude prices and a high refining margin on diesel, with U.S. refineries running at 97% of capacity in the week ending 11 September. The International Energy Agency's Oil Market Report of 11 September 2026 put U.S. diesel above US$200 per barrel, 94% above what it calls pre-war levels, its baseline from before this year's Iran war constrained Gulf exports through the Strait of Hormuz, with combined diesel exports from the Gulf and Russia 1.6 million barrels a day below their February level and a full recovery in Middle East supply now expected in 2027. The IEA said net diesel exports from the Gulf averaged 390,000 barrels a day in August, just over a quarter of their pre-war level, with more than 10 million barrels a day of Gulf oil output still shut in; it now expects world oil supply to fall by 5.7 million barrels a day this year and rebound by 8 million barrels a day in 2027. The extension to 31 December therefore covers the bills on which September's prices will first appear. TCJ emailed the Ministry of Finance and Economic Development on 21 September 2026 asking whether Cabinet had considered extending or replacing the cap. The Ministry did not reply to the question before the 28 September announcement.

CUC buys in that market. Its fuel contracts "use market-based pricing linked to internationally recognized Platts fuel price benchmarks", Pawlik said, and fuel loaded in the U.S. takes seven to 12 days to reach Grand Cayman, usually via the Bahamas, then about two further days to unload and reach CUC by pipeline, and may sit in inventory before it is burned. The Government's 29 April release had described the same exposure, calling the islands' "near-total dependence on diesel-fuelled generation" their deepest energy vulnerability.

Duty Stays Off Bills Into 2027

The same lag keeps duty off bills for longer than the waiver itself. CUC's fuel cost table shows a Government fuel duty entry of CI$0.012975 per kWh for June consumption and CI$0.013153 for July, and none for August or September, although the waiver began on 1 June. Pawlik said the fuel burned in June and July "included costs for fuel duty that had already been paid by the fuel providers and subsequently, CUC". She said the duty line "will reappear following the cessation of the programme, subject to the same timing lag", at a rate "usually in the CI$0.01 per kWh region". With the waiver now running to 31 December, that line does not return to a CUC bill until 2027.

April's Projection Against the Published Rates

The Government's April projection and CUC's published rates can be compared directly. On 29 April the Government said that without intervention the residential fuel charge could rise from CI$0.14 per kWh in prior-year summer months to as high as CI$0.24 per kWh in July 2026. CUC's published rates were CI$0.195054 for June, CI$0.225702 for July, CI$0.235293 for August and CI$0.225545 for September. August's rate was 68% above CI$0.14, and September's is 57% above the CI$0.144100 charged for September 2025. CUC said the cap was worth CI$17.43 to the average household for June consumption, against a fuel-driven increase of CI$63.46; by August the same household's relief had risen to CI$64.03.

The Base Rate Question

The cap runs alongside a base rate that rose during the relief period. CUC said on 3 July 2026 that its energy charge, facilities charge and licence and regulatory fees rose from 1 June 2026 following a review by the Utility Regulation and Competition Office (URCO), adding CI$3.27 and CI$1.06 respectively to the average bill. Richard Hew said in that release that CUC understood "any change to electricity bills can be challenging, particularly during the summer months". In the same release CUC said its investments in battery storage, generating-unit upgrades and resiliency projects had delivered US$7.9 million in fuel cost savings for Grand Cayman customers in 2025 and about US$1.85 million in the first quarter of 2026, and that it continues to advocate utility-scale solar as the route to lower fuel costs.

URCO said in a statement published on 13 July 2026, answering an Opposition call for the Government to explain why the increase was allowed, that the increase arises from the Rate Cap and Adjustment Mechanism in CUC's 2008 licence, an automatic annual formula tied to a mix of Cayman and U.S. inflation excluding food and fuel, and that its own role is limited to checking the data in CUC's calculation. Once that is done, it said, it has "no lawful discretion" to block an adjustment the licence requires, and any change to how rates are set needs an amendment to the licence through a process led by the Government. URCO noted that no minister responsible for utilities since 2008 had brought forward such an amendment, that Hew held the planning and infrastructure portfolio between 2017 and 2021, and that it has initiated talks with CUC on updating the licence, including the automatic adjustment, with Anglin's support.

Leader of the Opposition Joseph "Joey" Hew MP replied in a statement carried by Radio Cayman on 15 July 2026 that those facts were understood, and that the unanswered question was why, if scheduled base-rate increases were deferred in 2020 and 2022, a similar approach was not pursued in 2026. He asked whether a deferral had been discussed or requested this year, when the Government was informed of the proposed increase and what action it took. The precedents he cited are on the record: CUC said in 2020 that a 6.6% base rate increase due on 1 June that year would be deferred to January 2021 by agreement with the regulator because of the pandemic, and in 2022 that a 5.4% increase due on 1 June would likewise be deferred to January 2023.

Anglin told the news site Cayman Marl Road on 12 July 2026 that the Government could not have stopped the increase, that past relief had taken the form of negotiated deferrals rather than a block, and that CUC's circumstances had changed since a 2023 deferral was recovered over 2024. TCJ emailed Deputy Leader of the Opposition Kenneth Bryan MP for comment on 21 and 24 September 2026 and had received no response by publication.

What the Parties Said

Premier André Ebanks MP said in the release that the extension "provides some relief until the end of the year" and that while Government cannot control global fuel prices it can act to reduce their impact on electricity, transport and household budgets. Anglin said the CI$11.35 million spent by August "reflects the scale of the exposure facing a small island economy that imports the fuel used to generate electricity and move people and goods", and that extending the programme "avoids a sudden return of duties at a time when energy costs remain a concern". CUC President and CEO Richard Hew said the company welcomed measures that "provide meaningful support to our customers" and encouraged customers to manage consumption. Island Energy Director Matthew Bishop said that without the subsidy "the recent surge in global oil prices would have translated directly into significantly higher electricity costs" in the Sister Islands.

What the Waiver Removes at the Pump

The duty side of the programme is simpler to price. When the waiver began on 1 June the Ministry said wholesalers would receive duty credit for all duty-paid gasoline and diesel still in their tanks on 31 May, with URCO and Customs and Border Control measuring those inventories, so that the saving reached the pump without waiting for stock to turn over. The release said the waiver removes 75 cents per imperial gallon of import duty from gasoline, 85 cents from diesel sold at service stations and 25 cents from diesel imported for electricity generation, and continues to apply to propane. It removes only the duty component of pump prices and does not set or freeze them, so motorists may see a reduction, little change or an increase depending on international prices, though in each case, the Government said, prices should be lower than they otherwise would have been. URCO and Customs and Border Control will continue to monitor the supply chain with the Ministry of Finance and Economic Development so that the benefit reaches wholesale and retail pricing.

The Government called the extension "targeted, time-limited relief" while it advances Phases 2 and 3 of its plan. The April plan dated Phase 2, an expanded CHEER programme paying for or subsidising spray foam roof insulation and at a later stage more efficient air-conditioning units and fans, to 2027 and 2028, and Phase 3, the scaling of solar generation under the National Energy Policy, to 2027 and beyond. The figure the extension now turns on, October's fuel cost rate, is not in the Government's release; CUC's confirmation that it will be higher than September's came in its emailed responses to TCJ. What comes next is URCO's approval of that rate, which will show how much of the cap's value the extension has bought, and the Supplementary Appropriation Bill, which will put the CI$3 million before Parliament.