Jim Chalmers says the government intends to have a plan for Australia’s rising energy prices before Christmas, as he was peppered with questions about the cost of living by everyday Australians demanding concrete answers.

The treasurer said he was not going to rule out subsidies or changes to how energy companies were taxed in case the situation did not improve, but the focus remained on changes to regulations, including price caps.

As the solo guest on the ABC’s Q+A program, Chalmers faced a barrage of questions from people worried about their financial situations. Energy bills, which are slated to increase by up to 56% over the next two years, with part of that increase already being felt, were a particular focus.

Chalmers said it was his “intention” to have an answer before Christmas. He said the government would consider advice on whether the petrol resource rent tax was working “as it should” but regulation remained his preferred option.

“What we’re dealing with here is we’ve got to balance the fact that a lot of these companies have international contracts, there’s a lot of market sensitivity,” he said.

“I mean, we do care about our reputation as a trading nation. We’ve got a lot of contracts with Korea and Japan and elsewhere. And so there are a whole bunch of issues associated with this. And it’s more complex than it sounds. But that’s not a reason not to act here. It’s a reason to act in a considered, responsible, and sensible way.”

Chalmers also conceded that the circumstances impacting Australia’s energy prices – which include the war in Ukraine – made it difficult to say whether the government could meet its election commitment to lower energy bills by an average $275 a year by 2025.

“That’s just to level with people,” he said. “It remains the fact that the cheapest new sources of energy is renewable energy. That’s still the case.

“But I don’t think we can ignore the fact that, when the modelling was done in 2021, and an outcome in 2025, we’ve got this enormous event which has changed substantially the outlook for energy prices not just in Australia, but around the world.”

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Subsidies and taxation changes for energy companies remained on the table, Chalmers said, but only if intervention through regulatory changes did not work.

“We don’t want to rule it out,” he said. “Because if this situation continues to deteriorate over time, you want to have all of the options. But our preference is to do something with regulation.”

Raising Australia’s social security payment rates was not an option Chalmers was considering.

“I do need to be upfront with all of you about the nature of this challenge that we are confronting right now,” he said.

“And we will do what we can, but we need to do what we can in the context of only promising what we can afford and trying to work out what our best contribution to this problem is. And our best contribution to this is being restrained in our spending, giving some cost-of-living relief where it’s responsible, and investing in the sorts of things that will get us out of this.”

Having walked the government line on issues such as the stage-three tax cuts and Jobseeker, Chalmers did offer a personal preference to have “an Australian or an Australian design” on the $5 note.

The Reserve Bank of Australia governor, Dr Philip Lowe, said the central bank was consulting with the government over who would replace Queen Elizabeth II on the $5 note, with the placement not automatically granted to the new regent, unlike Australia’s coins.

“The governor of the Reserve Bank has indicated it’s a choice between the king or a design, in his view,” Chalmers said. “And, you know, I would rather see something Australian on the $5 note. But it’s not a decision that I take, or certainly not a decision that I take alone.”