The levy will add $840,000 to the cost of a 350-apartment development.

In another example, Icon Water points to a large mixed-used development on the Kingston Foreshore with 120 apartments, 150 workers in shops and offices and 500 seats in restaurants. That development equates to 335 extra people (workers and restaurant customers are calculated as a fraction of residents), and the developer will face a charge of $402,000.

Icon Water had planned to introduce its new levy only in four parts of the city where it said the water and sewerage systems needed to be expanded to cope with expected population increases - Woden, Belconnen, Fyshwick and the Northbourne corridor.

But the proposal brought strong opposition from the housing industry, which argued the cost would be passed straight on to people buying apartments, and would inflate prices and discourage buyers in those areas.

Icon Water has now changed its proposal so that all infill developments across the city will pay. It applies not only to apartments and houses, but to new offices, shops, hotels and other developments.

Icon general manager of finance Sam Sachse said the community feedback was overwhelmingly that the developer should pay the costs, not the community through higher water and sewerage rates.

The scheme was designed to ensure fairness to developers.

"Through the whole consultation process we've appreciated that the developers just want certainty. And one precinct, with one charge, provides that certainty," he said.

Asked about suggestions the charge would be passed straight through to home buyers, he said that was a decision for the developer.

The charge is worked out on a formula that counts an apartment as two people, a townhouse as 2.5, and a house as 3.6 people. It counts workers as 0.3 of a person, and school students and staff as 0.2 of a person.

Each new restaurant seat counts as 0.1 of a person, which means a new 70-seat restaurant would face a levy of $8700.

The formula also deducts whatever is on the site currently, so if 350 apartments replace 100 people on the site currently, the levy would come down from $840,000 to $720,000.

If two townhouses replace one house, the townhouse developer would be charged $6000, minus $4320 for the house, to a total of $1680.

The industry had called for a share per bedroom, rather than a formula that assumes every apartment is two bedrooms. It pointed to the fact that a one-bedroom apartment would face the same charge as a four-bedroom apartment.

But Icon Water said the number of bedrooms could change as a development progressed, so it would be difficult to set an accurate charge, and there could be disputes over what counted as a bedroom.

Icon made a formal submission this week to the regulator, the Independent Competition and Regulatory Commission, which must approve the new charge.

In its submission, Icon said a single charge would be more simple to understand and administer, and limit the chance of year-to-year fluctuations in the amount.

Icon will adjust the charge each year. It plans to raise about $80 million over 20 years to help fund about $160 million in upgrades to the network.

New suburbs in "greenfields" areas are not part of the levy; there, developers must pay the entire cost of the water and sewerage network.

The government's infill policy would see half of new homes to be built in existing areas, putting pressure on infrastructure across the city.

"For example, government decisions on the light rail project have already prompted (and will continue to prompt) brownfield development along Northbourne Avenue," Icon Water said.

The new charge is to take effect on July 1, but for people who buy land before June 30 this year and lodge a development application within two years, the charge does not apply.

The regulator will call for public submissions.