Prime Minister Anthony Albanese says his government will give "strong consideration" to intervening in energy markets amid alarming budget forecasts for electricity and gas prices.

Labor's first budget, which it released last night, is tipping electricity prices to increase, on average, 20 per cent by Christmas and a further 30 per cent in the next financial year. 

Combined, that would amount to a 56 per cent increase in power prices over the next 18 months.

Gas prices are also forecast to increase 44  per cent in the next 18 months.

"Intervention into the market … is something that we will give strong consideration to," Mr Albanese told the ABC this morning. 

"We'll be taking the advice of the appropriate departments about an appropriate intervention. We understand the pressures that are on here."

The prime minister said the competition watchdog would ensure companies were not taking advantage of global energy price spikes following Russia's invasion of Ukraine.

Shadow Treasurer Angus Taylor, a former energy minister, said the government's focus should be on supply. 

He said he would not comment on market intervention until the government provided more information.

"My starting point always is: If you want to get prices down, get more supply in," he said.

"There seems to be limited interest in that in Labor. You've got to get the dispatchable generation into the market fast."

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Economist Danielle Wood, the chief executive of the Grattan Institute, said the energy price forecasts were sobering.

She said the government faced a challenging situation but would have to take more "meaningful action" to tackle those prices.

"They could move to tighten regulation of prices," Ms Wood said.

"That would be a big move.

"At the moment they have focused on trying to secure supply but price is the challenge here.

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"The other thing they could do is follow the lead of some other countries and try and work on the taxation, particularly of super profits that are being earned while prices are very high around the world, and then return some of that to consumers by way of rebates.

"That would take the pressure off households, and it can be done in a way that won't add big inflationary pressures."

But Business Council of Australia chief executive Jennifer Westacott urged for caution on higher taxes.

"Be careful what you wish for, is my advice on super profit taxes," she said.

"We've got to remember why we're in this position. We're in this position because of external factors [like] the war in Ukraine.

"We're in this position because we've had 15 years of policy chaos in energy."

Mr Albanese insisted the longer-term solution to energy prices was to get more renewables into the market, a sentiment Ms Westacott endorsed.

But she said gas was an essential medium-term solution for Australia's energy mix.

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