Treasury modelling suggests the average Australian household will pay $230 less next year under the plan agreed by national cabinet on Friday, but power bills are still expected to rise by 23 per cent next year.

Federal opposition leader Peter Dutton seized on the plan as "catastrophic", saying it kills off Labor's election promise of a $275 reduction in household power bills by 2025, "It is gone and it will not be coming back". He also suggested the plan will increase energy prices.

While details are still to be worked out, the ACT is expected to get smaller rebates due to its electricity generation coming from 100 per cent renewable sources.

Federal Parliament will be recalled next week to deal with legislation covering the action on gas producers.

"Extraordinary times call for extraordinary measures," Prime Minister Anthony Albanese said.

"And we know with the Russian invasion of Ukraine, what we've seen is a massive increase in global energy prices. And because of Australia not investing in enough of our own energy assets, what we have is a vulnerability to those international price movements."

ACT Chief Minister Andrew Barr welcomed the Commonwealth $1.5 billion commitment, but said the ACT was more protected from rising energy prices than other jurisdictions.

"Through the ACT government's investments in long-term renewable energy contracts, ACT residents and businesses are far less likely to experience the sort of energy prices rises other jurisdictions are anticipating in the coming years," he said in a statement.

"The ACT, along with all other states and territory agreed to be involved in the development of a co-funded National Energy Bill Rebate to help soften the impact of rising energy prices on low-income consumers through temporary and target on-bill rebates."

There will be a mandatory code of conduct on the gas industry, with a 12-month cap of $12 a gigajoule, monitored by the Australian Competition and Consumer Commission. There will also be a temporary coal price cap of $125 a tonne.

There is currently a voluntary code of conduct on gas producers, and changing it necessitates the recalling of Parliament.

Energy topped the agenda of Friday's meeting of national cabinet, however the first leaders also discussed the COVID-19 fourth wave, natural disaster management and training for early learning. The meeting was held virtually as the Prime Minister is recovering from his second bout of COVID-19.

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The Commonwealth had promised to intervene in the energy market by Christmas, with coal and gas prices being pushed up due to Russia's invasion of Ukraine disrupting supply.

The federal budget in October had forecast a "sharp" 56 per cent increase in electricity prices and a 44 per cent rise in gas prices for households in the next two years. Without intervention, power bills were expected to go up by 30 per cent the year after.

Government officials now estimate that, without an intervention, the energy bills would go up by 36 per cent in 2023-24.

With the coal and gas caps, coming in at the same time, bills would be expected to increase by 23 per cent, or on average, a $230 reduction on what power bills would have been without intervention.

The opposition leader said Labor has broken its promise to reduce power bills by $275 by 2025, citing the war in Ukraine as "some excuse".

"Now that is dead and buried in the announcement today" Mr Dutton told reporters in Brisbane.

"The prices are going to go up under Labor. And I think we're going to look back in 12 months time, realising that this was a catastrophic decision made by a very bad government, a government that can't get the economic calls right."

Treasury officials expect energy prices will eventually settle down in the medium term.

The Prime Minister insists the bill relief plan will not fuel inflation and the money to reduce people's power bills will be delivered by the states and territories.

"It won't be the same plan in each state and territory, given each of them have different systems and indeed that is part of the complexity of what we have been dealing with, is the fact that we have eight different systems around the country," Mr Albanese said.

"There's a range of programs that some states and territories have now which is to take an amount off people's power bills.

"We will be providing support for those in receipt of Commonwealth payments. That is pensioners, for people who are receiving family tax benefits, people who are receiving JobSeeker, people who are receiving payments."

National cabinet also received a briefing on COVID-19 from the acting chief medical officer, Professor Michael Kidd.

The leaders agreed to extend the pandemic payment over summer for casual workers in high-risk settings.