Australia’s energy ministers have agreed to “look at all levers” to ensure gas supplies are maintained and prices are kept stable, Energy Minister Chris Bowen says.

Mr Bowen met state and territory energy ministers in Melbourne on Friday at a precarious time for the energy market, as a sharp predicted increase in gas prices feeds through to producer and consumer price inflation.

“We agreed everything has to be on the table. We have committed to consider all options on stronger action, on stronger regulation as a matter of urgency,” he said afterwards.

“We will act carefully, we will not act without strong evidence that whatever we do and contemplate will actually work to give relief to Australian families. We will act in concert.”

The ministers had agreed on “careful interventions” in the short-term to keep a lid on energy prices, while cheaper renewable energy is rolled out.

“This will ensure the Australian Energy Market Operator has the powers to ensure supply of gas over the coming winter and beyond,” Mr Bowen said.

Due to a quirk in the structure of the market, the law change will need to first go through the South Australian parliament.

At a meeting in Gladstone in November, the ministers will consider further rule refinements after consulting with industry.

The changes will give AEMO the ability to better identify, signal and address shortfall risks that will affect the consumer gas and electricity markets.

The Australian Energy Market Commission will conduct a review of the new framework within three years.

Earlier, Mr Bowen refused to rule out forcing gas companies to deliver more of the key fuel to the Australian market as bills spike for local consumers.

That followed former competition watchdog boss Rod Sims urging the government to threaten gas providers with export limits to try to lower Australian prices.

The federal budget released on Tuesday projected a 56 per cent increase in retail electricity prices over the next two years.

Gas prices were forecast to rise by 40 per cent this year and a further 40 per cent in 2023.

Labor committed at the election to lower average household energy bills by $275 a year by 2025, but this is unlikely with the ongoing volatility in coal and gas markets driven by the Russian invasion of Ukraine among other factors.

“State and territory ministers agreed today together with me that we will not stand by and watch [price rises] flow through to the Australian people without taking action,” Mr Bowen said.

“We have agreed we have levers at our disposal and we intend to carefully, methodically use those levers wherever it puts downward pressure on prices.”

He took a swipe at Russia for its “illegal and immoral” invasion of Ukraine, which has been a key driver of rising energy prices.

“Russia is the world’s largest energy supplier and that withdrawal from the world market will, of course, have an impact right around the world,” Mr Bowen said.

But he said the ministers remained in agreement that renewable energy was the cheapest form of energy.

“The faster we get transmission built, the storage built, the better our country will be and we are all at one in that endeavour – and we noted collectively, the progress we have made,” he said.

“Tasmania and Victoria and the Commonwealth working together, and there will be more to come. And the Commonwealth will partner with each state and territory wherever possible in rewiring the nation in the same cooperative spirit.”

In his budget reply speech on Thursday night, Opposition Leader Peter Dutton said Australia needed to have an “intelligent conversation” on the role nuclear power could play in providing affordable and reliable emissions-free energy.

“If you don’t like coal, you don’t like gas, hydro is probably a decade away, you’ve got limited options … all I’ve said is we should have a discussion about the zero-emission modular nuclear reactors,” he told the ABC on Friday.

“All of us are in favour of renewable energy of course, the fact is we need to firm the system up at night time.”

-with AAP