The SPCA is urging battery hen farmers to consider converting to barn housing for layer hens rather than changing to colony cages.
The Egg Producers Federation has announced the proposed change to colony cages is accepted by the industry but that it will cost $150m and take an estimated 18 years for industry to recoup.
The SPCA said the cost of converting from battery cages to a barn system was less than converting to a colony cage system and would deliver the cage-free eggs consumers wanted.
"Consumers are becoming far more conscious of where and how their food is produced and they don't want cages," SPCA national accreditation and marketing manager Juliette Banks said.
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"With a steady annual increase in the free-range egg market it is clear consumers will not accept caged eggs in the future. For the industry to spend millions converting a system that consumers will reject seems pointless."
Ms Banks said the production cost of barn eggs was only slightly higher than the colony system so the cost difference to consumers would be minimal.
"However, the life quality of the chicken is considerably better," she said.
Egg Producers Federation chairman Michael Guthrie has previously said the colony system had been extensively trialled and proven to be effective.
"Colonies not only meet the requirements of the law, but they achieve what we would all regard as desirable - the opportunity for birds to indulge in natural behaviours such as nesting, scratching, perching and spreading their wings."
The Federation also wanted to ensure eggs remained affordable during tough economic times, he said.