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NEG passes 1st test

The National Energy Guarantee (NEG) has been waved through to the next stage at a meeting of the states and territories in Sydney.

It will now be voted on by the federal coalition party room on Tuesday and will need to have a stronger emissions reduction component to satisfy Victoria and Queensland.

Tasmania's Energy Minister Guy Barnett emerged from the meeting endorsing the intent of the NEG.

"That future action includes further interconnection, not just across Tasmania and the Bass Strait, but across the country, further interconnection is really important in keeping power prices down, the federal government knows that, the state government in Tasmania knows it and my colleagues around Australia know it."

The Prime Minister expects the majority in the federal coalition party room will vote in favour.

"There is very strong support for the National Energy Guarantee, it's been considered at different stages by the party room in the past, (Energy Minister) Josh Frydenberg will be bringing back the outcome of the meeting together with the relevant federal legislation to the party room next week."