Momentum is building for a royal commission into surging power prices after Deputy Prime Minister Michael McCormack backed the idea, setting up a clash with the energy sector, which decried the step as “extreme”.

Prime Minister Scott Morrison on Monday declared he would consider a royal commission into the energy sector, escalating the major party battle to dominate policy on electricity prices ahead of the federal election.

Prime Minister Scott Morrison said he was "open" to a royal commission in to the energy sector. Credit:James Davies

Mr Morrison told radio station 3AW that big power companies were “as bad as the big banks”.

"I'm open to it ... I'll look at it," Mr Morrison said of a royal commission, adding the inquiry was not needed “at this point”.