The government's energy intervention is underway. Here's what it means

So, why is the government doing this? What does it mean for power bills?

And what is this I'm hearing about David Pocock wanting to electrify an entire Canberra suburb?

Let's start with the problem the government has been trying to fix.

Vladimir Putin's illegal invasion of Ukraine has caused a global energy crisis from which Australia has not been immune.

The price of electricity and gas has skyrocketed, putting pressure on households and businesses, particularly those in manufacturing.

The October federal budget confirmed the worst was yet to come, forecasting the price of electricity and gas would rise 56 and 44 per cent respectively in the 18 months through to the end of 2023.

After weeks of public and closed-doors discussions, the Commonwealth struck a deal with the states and territories to intervene in the energy market to ensure those gloomy numbers didn't eventuate.

The bill rushed through in a single sitting of Parliament on Thursday delivers on the Commonwealth's side of the deal.

It imposes a 12-month, $12 per gigajoule cap on uncontracted gas in the domestic market, and establishes a mandatory code of conduct to regulate behaviour in the sector.

The code, which will remain subject to consultation through to February, will include a provision to make sure domestic prices are set at "reasonable" levels.

It's controversial - but more on that later.

The federal government has also set aside up to $1.5 billion for relief for households and small businesses, which the states and territories will deliver through rebates on bills.

The states and territories will also match the Commonwealth's contribution dollar-for-dollar.

For their part, the states - specifically NSW and Queensland - will use their own powers to put a $125-per-tonne cap on coal.

Crisis averted?

Not quite.

The federal government has admitted power bills won't fall as a result of the intervention - they just won't rise as much as feared.

Energy prices are expected to increase as much as 23 per next year, down from the 36 per cent expected prior to the emergency action.

Treasury modelling estimates the average household would have been $230 worse off next year had the steps not been taken.

But not every household will directly benefit.

The rebates will be targeted at people on Commonwealth income support, including JobSeeker, the age pension, seniors card and family tax benefits.

The finer details - including the size of the rebates - will be thrashed out over summer and agreed to at national cabinet before March.

That means the hip-pocket relief, for those who get it, won't be felt until well into next year.

One thing is clear: the ACT can expect less help than other states and territories, as the Barr government's long-term renewable energy contracts have helped shield the territory from the worst of the electricity price hikes (gas prices are still high).

No.

The oil and gas industry is furious that governments are meddling in their market.

Of particular concern is the "reasonable" price provision which will be inserted into the mandatory code of conduct.

Australian Petroleum Production and Exploration Association boss Samantha McCulloch believes the measure will have a "chilling effect" on investment.

The Coalition voted against the legislation on Thursday because it opposes the price controls, for much the same reasons as the gas giants do.

"We don't support market intervention which is going to result in higher power prices, less supply of gas into the system, and less Australian jobs," Liberal leader Peter Dutton said.

It is hard to imagine there is much public sympathy for the gas giants, which are enjoying massive profits on the back of surging international prices.

Its important to remember that the intervention only deals with domestic market, meaning gas companies can continue to export at high prices.

After a few days of umming and ahhing, the Greens agreed to support Labor's legislation, guaranteeing its passage through the Parliament.

The government got the Greens across the line after agreeing to develop a package of measures to help low-income households and small businesses with the upfront costs of switching from gas-powered to electrical appliances.

The Greens are so keen on electrification because, as party leader Adam Bandt said, it can offer households savings that "last a lifetime".

"This is the beginning of the end for gas," Mr Bandt said.

The package will be put together in time for the next federal budget in May, but at this early stage details are scant. We don't know how much will be spent, nor what households might be able to get.

Climate Change and Energy Minister Chris Bowen offered one hint on Wednesday afternoon, suggesting the Clean Energy Finance Corporation (CEFC) could be used to underwrite the program.

Mr Bowen pointed to the CEFC's recent announcement of concessional loans to help motorists purchase an electric vehicles as the type of incentive which might be included in the package.

If it is, the package could look something like the ACT's highly successful sustainable household scheme, which offers no-interest loans of up to $15,000 to purchase solar panels, batteries, electric appliances and EVs.

Canberrans have made more than 11,250 loan applications since the program opened last June, with more than half for rooftop solar.

Asked if an ACT and federal scheme could work in tandem, ACT Chief Minister Andrew Barr said: "Potentially".

"There are a complex set of features to work through and treasury officials across the country are engaging with the Commonwealth to work through the best responses for each jurisdiction," he said.

"The biggest challenge many households face, particularly low income households, is the upfront costs of investments like rooftop solar and replacing gas assets.

"Growing capacity in the scheme would be beneficial, as it has been very popular with Canberrans."

A Climate Council report this year found that large Canberra households could save up to $1900 on their power bills from switching from gas to electrical appliances.

David Pocock is a huge advocate for electrification, convinced it is the long-term solution to easing power bill pressure on Australian households.

To prove it can work, he has asked the government to trial the electrification of a Canberra suburb.

That means solar panels on roofs, heat pumps, batteries and so on.

The Parliamentary Budget Office has estimated it would cost $11.3 million over four years to help 1000 households make the switch.

Under Senator Pocock's proposal, taxpayers would fund 50 per cent of the costs for those households to install solar PV systems, electric reverse-cycle air-conditioners and heat-pump water heaters.

Subsidies would also be offered to lease an electric vehicle for two years, with an option to purchase after that.

Mr Bowen has said the government would consider it, but at this stage its very much just an idea.

There is no suburb in mind, nor an indication of how one might be selected if the government takes up Senator Pocock's plan

Every Canberran will be hoping they're living in the lucky neighbourhood.