Preheat oven to 350oF (180oC).
To a bowl, add sugar and water. Whisk until sugar dissolves completely.Add coconut oil. Mix well. To the same bowl, sift the flour, baking powder and salt.
Add the coconut and mix until dry flour no longer visible.Do not overmix. Scoop batter to cupcake pan lined with cupcake liners. Fill until half full.
Bake in preheated oven 350oF (180oC), rack middle position, for 18-20 minutes or until toothpick comes out clean.
Let cupcakes cool down in pan for 10 minutes. Then remove from pan and transfer to wire rack. Let cupcakes cool down completely.