As the government searches for cost of living solutions, Climate Change and Energy Minister Chris Bowen is readying to lift the cap on coal prices.
This would settle millions of dollars of compensation to New South Wales power generators but would increase power bills for consumers from the middle of the year.
The price caps on both coal and gas were initially implemented to put a ceiling on soaring household power bills.
Treasury figures show $165 million had already been paid to generators but could reach up to $1 billion by June.
Both gas and coal prices were capped last year with the gas price cap being extended to 2025 but no decision has been made to extend coal price caps.
(SKY NEWS)