The Office of Fair Trading says the decision by Manx Gas to raise prices next month will be justified - if the company's profit predictions are correct.
Gas bills will go up by 2.9 per cent and the standing charge by three per cent from September 12.
The long, warm summer has meant Island householders are using less gas - and that, in turn, has hit company profits.
Manx Gas has pegged its profit target at the mid-point in a range of so-called acceptable returns, agreed by the OFT.
The company says it needs to rely on future income if it's to invest in the Island's gas network and ensure a reliable service.
The OFT's chief officer Mike Ball says the rise is based on company projections - which can only be tested further down the line:Clip 1
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