National cabinet has agreed to give electricity price relief for homes and companies by placing limitations on coal and gas prices as well as monetary support.
Gas prices will be regulated to $12 a gigajoule for 12 months, while coal will be temporarily capped at $125 a tonne, following an agreement on Friday between Prime Minister Anthony Albanese and state and territory leaders at a virtual national cabinet.
A strict code of conduct will be put in place for the gas industry, with federal parliament to be recalled next week to enact the law.
Anthony Albanese (shown) outlined national cabinet’s plan to provide electricity price relief for consumers on Friday evening
A further $1.5 billion will be allocated in energy bill relief for support to home businesses, which will be paid through state governments.
Treasurers are poised to work through a relief package for each state and territory.
Financial relief for energy costs is projected to commence in the second quarter of 2023.
Mr Albanese said the bill relief will not be direct cash giveaways, to protect inflation levels.
‘It will not be the same plan in each state and territory, because each of them have different systems,’ he said.
‘That is part of the intricacy of what we have been dealing with is the reality that we have eight separate systems around the country.’
Mr Albanese said unprecedented efforts would be made to decrease the cost of energy.
‘We’re taking swift measures to safeguard Australian households from the worst impacts of these price spikes,’ he added.
‘We’re working hand in hand with our state and territory colleagues to find the best outcomes for all Australians.’
‘We’re working hand in hand with our state and territory partners to achieve the best outcomes for all Australians,’ Mr Albanese (pictured) said
Electricity price alleviation will be adjusted differently based upon each state and territory
The government budget anticipated a 56 per cent increase in power rates and a 44 per cent hike in gas prices for families in the next two years.
The prime minister said 12 months would be the correct length of time to put the temporary restrictions in place.
‘The appropriate way to pay it is through state governments because that is how you take money off people’s bills rather than make cash payments and that is key so that you have a deflationary impact rather than inflationary,’ he said.
National cabinet was briefed by Australian Energy Regulator chair Clare Savage, who told the meeting there has been downward pressure on energy costs since the federal government signalled it would take action.
Mr Albanese revealed the consumer watchdog will oversee the monitoring and enforcement of the new code of conduct for gas firms.
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