The head of the consumer watchdog said the temporary price cap on wholesale coal and gas will stop prices ballooning out of control, but energy users can still expect elevated prices for a while yet.

The Australian Competition and Consumer Commission boss, Gina Cass-Gottlieb, said intervening in the energy market would prevent increases higher than those estimated in the budget.

Predictions in the October budget showed electricity prices likely increasing by 56 per cent over two years and gas prices by 20 per cent annually in the same period.

“Treasury has forecast an estimated 20 per cent increase this year as a result of the increased prices flowing through post the Ukraine invasion and the significant global disruption,” Cass-Gottlieb told ABC Radio National.

“This intervention is seeking to mitigate it such that there are no greater increases over 2023, and to see reductions flow through.”

She said the price caps should eventually work to reduce prices at the top of the supply chain, which would prompt competition between retailers to lower prices.

The federal government intervened in the energy market late last year, implementing a temporary 12-month price cap on coal and gas.

Labor is also consulting on a mandatory code of conduct that’s expected to include a “reasonable gas price” mechanism.

On Tuesday, the ACCC provided guidelines to help gas companies better understand their obligations, while also confirming it would investigate producers trying to avoid supplying gas below the price cap under the cover of confusion.

Gas retailers say they have been struggling to lock in new contracts with producers since the price cap came into force, preventing them from providing affordable gas to new industrial and commercial customers.

Industry Minister Ed Husic said Australian gas companies were “addicted” to huge war-driven profits.

“There might be some that are addicted to the Putin profits that they were making, and they’re going through withdrawal symptoms, but they should be under no illusion about the determination of the government to get the balance right in terms of pricing,” he told Sky News on Tuesday.

Liberal senator Jane Hume said Husic’s comments were “demonising” gas producers and would ultimately choke new supply.

“Using language like Putin profits, that’s extraordinarily immature and extremely offensive,” she told ABC’s RN.

“We know that supply is the key to lower prices, and if investment is about opening up supply then what would that language do for investors wanting to invest in Australia?”