Anglian Water customers face a £12 increase in water bills in 2013.
The average rise will be kept at 2.8 per cent - below the level of inflation - by the large numbers of customers switching to a water meter.
Martyn Oakley, Anglian Water's customer services director, said: "The real winners this year will be those customers who make the switch from an unmeasured bill to a water meter.
"For those already on a meter or who stick with bills tied to the old rateable value of their home, the rise will be about 4 per cent, although customers with a meter will see smaller rises than those without.
"This rise is mainly due to inflation, which was at 3 per cent when bills were calculated.
"The remaining 1 per cent is to help pay for Anglian Water's investment programme, which this year will be £466 million.
"That investment will allow us to maintain and improve our essential equipment above and below ground, support growth and recovery in these tough economic times, and protect our environment against the impacts of climate change."
Anglian Water plans to spend around £6 million on a new water treatment works near Louth.