Charges for household water and waste water in Scotland will increase by 4.2% for the next year, with an average bill increase of 31p per week.
Scottish Water, the public company accountable to ministers which is responsible for providing water and sewerage services, supplies some 2.6 million households in Scotland.
It says prices will need to rise further in future years.
READ MORE: Historic Edinburgh Scottish Government base sold to US firm in massive £78m deal
Net Zero Secretary Michael Matheson said: "We remain committed to supporting people facing issues paying their water bills.
"While UK-wide energy prices rise beyond inflation, in Scotland the increase to water charges for 2022-23 has been set at 4.2% - in line with inflation.
"In developing the charging principles for the industry for 2021-27, ministers took the decision to increase the levels of support for those vulnerable customers who have the most difficulty paying.
"The water charges reduction scheme discount has increased from 25% to 35% - protecting thousands of eligible households from higher charges.
"Households in receipt of the full water charges reduction scheme discount will actually pay less than they did in 2020-21.
"Our average water charges remain lower than the average in other parts of the UK - in 2021-22 the average charge in Scotland is £375, compared to £408 in England and Wales."
Douglas Millican, chief executive of Scottish Water, said: "We have been recognised as leading in the water sector in the UK on customer service excellence, the quality of Scotland's drinking water remains very high, and we are investing to protect the environment from pollution.
"Higher levels of investment are needed to protect services now and over the long term, particularly in meeting the challenges of more intense rainfall, flooding, and drought, and reducing carbon emissions.
"We understand there needs to be a balance between the need for higher levels of investment and the financial challenges faced by households at the present time.
"We have set charges at a level that takes account of those challenges while being open and clear that charges will need to increase further in future years."
Scottish Labour deputy leader Jackie Baillie said: "The SNP have the power to do something about this and are choosing to put up bills.
"Families across Scotland are already struggling to pay their household bills.
"This week, people are tuning in to the news to see costs are about to spiral out of control while the SNP and Tory governments sit and do little to help.
"Scottish Water is sitting on hundreds of millions of pounds of reserves while putting up the bills.
"The Scottish Government must stand up for the interests of customers and cap these rising costs."
