The demand for a gas price cap is being taken seriously by the federal treasurer, in view of an expected increase in energy prices.
With gas prices expected to rise 40% over the next two years and retail electricity prices 56%, Jim Chalmers said all options are on the table to reduce electricity bills.
“We are considering the kind of measures that governments would not have considered a year or two ago,” he said on Sunday.
“You can follow the path of taxes, you can follow the path of direct support for families, we do not want to exclude this type of option, but our immediate objective is the regulatory aspect”.
Dr. Chalmers said he took ex-consumer watchdog Rod Sims’ calls for gasoline price caps seriously. He said there were talks about other measures that could be introduced.
Among these was a mandatory code of conduct for gas companies, and although the code focused on gas supply levels, the treasurer said it could extend to pricing as well.
“We don’t really want to limit our options or reduce our options,” he said.
“There is a lot of work going on behind the scenes, a lot of consulting and collaboration, and if there is anything sensible, responsible and meaningful we can do here, of course we will consider it.”
The government pledged ahead of the election to reduce the average household electricity bill by $ 275 per year by 2025.
However, this is unlikely to be achieved due to the volatility of the energy markets caused by the Russian invasion of Ukraine.
“We are still recalibrating our expectations for higher electricity prices,” said Dr Chalmers.
However, Opposition Jobs spokesperson Michaelia Cash said strengthening gas supplies and price caps is equally essential.
“All a price cap will do is actually discourage players from sourcing,” he said.
Victorian Prime Minister Daniel Andrews said rising energy prices due to the war in Ukraine reinforced the need for a national gas reserve.
“What the gas companies are asking us to do now is pay European prices for our gas,” he told reporters in Melbourne.
“We need a national national reserve so that our gas goes first to our businesses and our families, and what little we don’t need to sell to the world.”