Mills warns of big rise in power and water costs

Chief Minister Terry Mills is standing by his prediction of substantial power and water price hikes for the Northern Territory.

He says the Government plans to increase tariffs to deal with Power and Water Corporation's debts and bring utility costs in line with the national average.

But Mr Mills says existing power and water subsidies will remain.

"Quite honestly, I can tell Territorians there will be an increase," he told ABC radio's Julia Christensen.

"It will be substantial but we can't say for certain what that amount is.

"Our primary objective is to get this business on to a sound footing." He says funds earned from the price hike will also be used to fund network and generation upgrades.

"We have got to have a well-run, effective service, right here and now," he said.

"We have to get it on to an efficient footing so at least it operates properly.

"That can't be achieved unless there is an increase in tariffs." Meanwhile, Darwin Lord Mayor Katrina Fong Lim says the city council may have to re-evaluate its planned rate rises because it did not take into account significant increases in its power and water bills.

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