Piper Alderman lawyer Greg Whyte said the class action sought compensation for all Queensland consumers who “had to pay inflated electricity prices while the gaming practices were in play”.

“There was no justification for the dramatic price spikes in wholesale power charged to power retailers in Queensland,” he said.

“Price spikes like this can’t be explained away by unexpected demand, or by system faults which can occur.

“These price spikes were both contrived and massive, moving prices from an average cost of, say $70, to the price ceiling of, say, $13,000 in a five-minute period.

“The unacceptable practices slowed when the State Government intervened by issuing a directive to Stanwell Corporation to ‘undertake strategies to place downward pressure on wholesale prices’ in the words of the directive, but by then the damage had been done.”

In response to the class action, Stanwell has warned Queensland taxpayers would bear the cost of its defence through a dividend reduction.

“We are disappointed that international litigation funders and their representatives have targeted us in this case, and emphatically reject their claims,” a Stanwell spokesperson said.

“Their allegations against us are false, misleading and clearly opportunistic.

“We believe this action reflects a fundamental misunderstanding of the Australian electricity market. We will continue to vigorously defend against it in court, but we expect this will be a long and costly process.”

In a statement, CS Energy said the class action had been backed by “litigation funders”.

“We reject the claims being made and are strongly defending this class action,” CS Energy said.

“This has been, and will continue to be, a long and complex legal process.”

The matter, before Justice Sarah Derrington, was expected to last about eight weeks in the Federal Court.