N some freshwater organisms there is a structure called a contractile vacuole that regulates water movement into and out of the cell. What explains the existence of the CV?

Without it, the cell will become engorged. The cell membrane could then tear and the cell could burst. The contractile vacuole controls the amount of water received through osmosis (the natural flow of water through the membrane). So, by regulating the flow, you are controlling how much excess water is inside the cell. Just like a balloon--it can be filled with a lot of water, but once it is filled up too much, it bursts.