Manx householders will see their electricity bills and water rates go up by 2.2% from next month - well ahead of annual inflation.
Latest figures show the cost of living measured by the Consumer Prices Index fell again last month from -0.2% to -1.0%.
The Manx Utilities Authority says the cost of servicing the merged body's ?500 million debt to government is partly to blame for the price hike.
Electricity tariffs will rise across the board for domestic, commercial and industrial customers, and fixed charges will also go up, to pay for the Island's electrical infrastructure.
The rise will add ?24 per year to the average household electricity bill and ?12 to the water rates.
The sewerage rate - to replace the unpopular fixed charge toilet tax - has been set at 61.3 pence in the pound.
MUA chairman Alfred Cannan says he understands the financial pressures on consumers and insists the authority is doing all it can to trim its own costs:
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