The chairman of the Water and Sewerage Authority says customers can't expect savings in the short term when the utility merges with the Manx Electricity Authority.
John Houghton MHK says tariffs, particularly for electricity, are likely to rise.
Households and businesses will also have to pay a £50 sewerage charge on April 1, when the Manx Utilities Authority comes into existence, with that doubling for next year.
Mr Houghton, who's also vice chairman of the Manx Electricity Authority, says the merger is about managing the MEA's debt:
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