Natural gas supplies for the nation's most populous state are being assessed and projects proposed by market players are welcomed to increase availability of the fossil fuel, NSW Energy Minister Penny Sharpe says.
"We don't want to see price spikes and we don't want to see uncertainty for industry," she told a Committee for Economic Development of Australia energy event on Tuesday.
Penny Sharpe has acknowledged there's a tight balance between energy supply and demand in NSW. (Dan Himbrechts/AAP PHOTOS)
A tight balance between supply and demand had emerged, a "new normal" NSW did not like, Ms Sharpe said.
More gas-powered plants would also be needed to cope with peak demand during the transition to renewable energy sources, she added.
"More and more renewable energy is entering the system, but it's always happening more slowly than we would like," Ms Sharpe said.
The state Labor minister said she was "unimpressed" by a proposal from the federal coalition to roll out nuclear power stations, a plan that she said posed too many important but unanswered questions.
"We're not risking our future economic prosperity for a policy thought bubble designed to play politics," Ms Sharpe said.
Opposition Leader Peter Dutton unveiled plans in June to build seven government-owned nuclear power plants across five states if the coalition wins the next federal election.
Nuclear bans are in place in most states and territories, measures that would need to be overturned or circumvented before the rollout could take place.
The chief executive of Australia's largest energy generator and greenhouse-gas emitter also reaffirmed that nuclear power did not form part of the company's plans.
AGL's Damien Nicks told the same event that the electricity supplier focused on renewable generation and storage.
Damien Nicks says in a decade AGL won't be generating electricity from coal. (Dan Himbrechts/AAP PHOTOS)
"AGL's generation portfolio will look completely different by 2035, when we're no longer generating electricity from coal," he said.
Ms Sharpe on Tuesday announced the inaugural chair and seven commissioners for the state's Net Zero Commission.
The commission was created in December and will report to the government on its progress towards legislated emissions-reduction targets, including a goal of net-zero emissions by 2050.
Former NSW Treasury secretary Paul Grimes has been appointed chair, while he was added to the commonwealth's Emissions Reduction Assurance Committee in April.
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