The coal price cap is what is sold to power plant within australia. The gap is what the govt will subsidises to the amount of the cap vs international received price generally newc. They cannot force coal producers to sell at a loss and only to australian consumers. Its like forcing woolworths to cap food prices by passing the law. That doesnt happen. they can use laws to limit 20% production for Australian use. That in itself is market limiting and in generally frowned upon within international market regulations and agreements.
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