It is also pledging to speed project approvals under national environmental laws and requires states to do the same with their planning processes.
Known as the National Capacity Investment Scheme,clean energy sources will be funded by the Albanese government while fossil fuels are barred.
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State and federal governments agreed in December to start work on the reform to underwrite clean power projects.
Cheaper renewables are already undercutting the profits of coal plants with seven of the remaining 14 coal plants on the eastern seaboard due to shut within 12 years.
The Australian Energy Market Operator has warned of an increased blackout risk starting this summer and continuing into coming years,driven by a lack of replacement power and a forecast shortfall of gas supply.
As renewables investors may be reluctant to fund projects if it means power bills could be too low to generate an attractive return,the government will share the risk by setting a floor and ceiling price on their earnings.