Melbournians can expect to see significant hikes to their water bills over the next financial year following the final decision by the market regulator.

The Victorian Essential Services Commission handed down its final Price Review for the Greater Metropolitan Water businesses, with price rises set to increase by an estimated $200 next financial year.

The ruling comes after retailers sought a 31.7 to 35.8 per cent hike to prices over the next five years to cover the costs associated with the recently completed Wonthaggi desalination plant.

But the Commission concluded that a more modest increase of between 20 to 26 per cent was in order.

Chairman of the ESC, Dr Ron Ben-David, admitted that the desliantion plant represented the “single largest driver of the price increases proposed by the water businesses,” in his ruling.

The final report can be found here