A new ruling could allow Canberra households to be hit with an average rate rise of about $8 a year on combined water and sewerage bills.

The Independent Competition and Regulatory Commission (ICRC) has handed down new maximum prices for ACT water utility Icon Water.

The ICRC said the changes would see water prices fall by about 1.5 per cent while the price of sewerage services increases by 3.5 per cent in 2015-16.

Overall, the price changes would see annual bills for a typical household (consuming 200 kilolitres of water per year) rise by less than 1 per cent.

Experts had earlier predicted that water and sewerage bills would rise by $14 a year, but a change in the Consumer Price Index (CPI) means the real figure is slightly lower.

New prices are set to come into effect from the end of the month.

The ICRC review found that the new pricing scheme would allow Icon Water to earn sufficient revenue to fund long-term water security projects like the enlarged Cotter Dam.