The Independent Pricing and Regulatory Tribunal has set the 2021-22 rate peg at 2 per cent, which includes 0.2 per cent to help councils fund next year's elections.

Rates went up by 2.6 per cent in the current 2020-21 financial year.

Councils can apply for a higher rate rise but Orange mayor Cr Reg Kidd said it wasn't likely in the Orange City Council area.

"We are always trying to keep it at the [peg] rate," he said.

"We want to support the community in any way we can."

Cr Kidd said the increase would barely cover inflation and was lower than the increases in the previous three years.

"We have got a pretty exhaustive budget planned. We're looking at selling off [some assets]," he said.

Cr Kidd said he was also concerned at the high cost of elections.

"Through the Electoral Office it's not a cheap task at all. It is super, super expensive to hold an election," he said.

Tribunal Member Deborah Cope said IPART recognised councils faced higher costs for the elections.

She said the 0.2 per cent adjustment should cover costs.

"This allows councils to collect additional revenue in 2021-22 to meet the costs of the 2021 local government elections," she said.

IPART's rate peg is based on an index of the average costs faced by NSW councils.

She said it reflects moderate price inflation over the previous year for most cost categories.

"The rate peg for 2021-22 is lower than recent years, which is a positive outcome for NSW ratepayers," she said.

Ms Cope said the rate peg increase is the maximum councils may increase their general income. For almost all councils, general income consists entirely of revenue from rates.

However, individual ratepayers' rate rises can vary according to other factors including land values set by the Valuer General NSW.

IPART also announced it will not set a limit on percentage variations for annual domestic waste charges made by councils for 2021-22.

It is currently seeking feedback on its recently-released discussion paper on these charges. Submissions close on October 6.