Treasurer Jim Chalmers says the government is willing to open its coffers to help ease energy price pain.
Ahead of a national cabinet meeting on Friday, Dr Chalmers said all options remained on the table with the government preparing to hand down its path forward before Christmas.
But he said it would rather avoid slapping a windfall tax on large energy companies.
“We would prefer where possible a regulatory response here but we said we are prepared to consider other options as well, including if there’s a case for some responsible contribution from the Commonwealth,” he told reporters in Sydney on Tuesday.
The treasurer said the government was negotiating with the states in good faith with price caps for coal and gas floated as a potential way to ease soaring bills.
He said the states had a greater role when it came to the regulation of coal while the federal government is working alongside the Australian Competition and Consumer Commission to assess regulatory levers that can be pulled in relation to gas.
“We welcome the spirit with which the various states are engaging with us on this really complex and difficult public policy question,” he said.
Dr Chalmers added that any response would be “temporary and meaningful”.
But when relief would start flowing through to households remained a mystery.
“If you could just flick a switch and make this challenge go away, then somebody would have already done it by now,” he said.
“So our target and objective is to take some of the sting out of these price rises next year.”
Prime Minister Anthony Albanese will still be in isolation with COVID-19 in Sydney when he meets online with the premiers on Friday.
He has come under fire from the NSW treasurer for not providing enough information about a proposal to cap coal and gas prices.
“We need to see the detail of the Commonwealth’s plan to solve this national problem (and) to see the modelling about how we’ll keep prices down,” Matt Kean told ABC Radio on Tuesday.
Mr Albanese rubbished the claim and said leaders had been given “a whole lot of detail” about what would be proposed, as well as legal advice.
“You’ve got to draw a distinction between what some states say in public in order to promote their own position and what is actually happening,” he told ABC Radio.
“What’s been happening is very constructive dialogue … bureaucrats have been working this through for weeks.”
A planned energy ministers’ meeting will go ahead on Thursday.
Federal Energy Minister Chris Bowen said he would discuss rising energy prices and provide an update on the nation’s capacity for renewable energy to his state and territory colleagues.
The NSW government will support a price cap but Mr Kean said his federal counterparts must provide compensation to ensure taxpayers in his state weren’t affected by lost royalties.
“The Commonwealth is yet to put a single dollar on the table to help with energy costs,” he said.
“We want to see whatever it takes to protect families and businesses.”
Nationals leader David Littleproud said small modular nuclear reactors could be a solution.
He called on the prime minister to reconsider a national energy summit where stakeholders could have a “mature conversation” about power alternatives.
Dominic Giannini, Maeve Bannister and Andrew Brown
(Australian Associated Press)