The New South Wales government is working on a plan B to the national energy guarantee ahead of a meeting of federal and state energy ministers expected next month.

The Morrison government has been under pressure from some of the Liberal state governments, including NSW, to bring back the Neg. The policy was a casualty of the federal Liberal party’s leadership eruption last August.

The Neg remains the first preference of the some of the state jurisdictions, given it allows for a national approach. It also has strong support from business and the energy sector.

But given the commonwealth has signalled that Malcolm Turnbull’s signature energy policy will not be revived, Guardian Australia understands NSW is now working on an alternative 2030 strategy that will require policy support from Canberra.

Officials say the NSW plan would involve Canberra assisting a transition to lower emissions by underwriting generation, probably firmed renewables, to replace the Liddell power station, and also underwriting and de-risking new investments in transmission that have been highlighted as urgent by the Australian Energy Market Operator (Aemo).

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It is possible NSW will ask Canberra for seed funding for some transmission projects, as well as a regulatory overhaul to make the investments more attractive to private proponents. It is understood preliminary discussions about the ideas between NSW and Canberra have been constructive.

State governments have pursued discussions among themselves since the failure of the Neg about how they can work up a joint strategy on transmission, including rolling out the poles and wires necessary to transfer supply from the Snowy 2.0 expansion into NSW and Victoria.

Officials insist the state proposal is well advanced but the NSW energy and environment minister, Matt Kean, declined to comment when contacted by Guardian Australia.

The federal energy minister, Angus Taylor, is yet to confirm when he will meet his state counterparts in the Coag energy council, but some stakeholders believe the meeting will be in Brisbane in September.

The Coag council has been in abeyance, with the Liberal states continuing to champion the Neg and Taylor refusing a reboot on the basis it would reopen the divisions in Canberra that helped foment the strike against Turnbull.

There is a view in NSW that the ageing Liddell plant needs to be replaced by firmed renewables with gas peaking as back-up, because that’s the cheapest option and will also help to reduce emissions. But the power baron Trevor St Baker is lobbying Canberra and the Berejiklian government to transform the site into an “exclusive baseload power precinct”.

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St Baker told Guardian Australia: “I think making Liddell an exclusive baseload power precinct and paying all the existing generators for spinning reserve that they’ve never been paid for could give AGL or any purchaser of Liddell a better business case to keep it going for as long as it can keep going, and not retiring it until it is replaced by a like for like baseload plant providing 24/7 power.”

In May, the treasurer, Josh Frydenberg, indicated in an interview with Guardian Australia that the then newly elected Morrison government would pursue new infrastructure to support renewable energy zones in line with advice from Aemo.

Aemo used its most recent 10-year forecast of reliability in Australia’s power supply to highlight the urgent need for more investment in dispatchable energy and in transmission infrastructure.

In a frank assessment, the chief executive of Aemo, Audrey Zibelman, said the energy market operator had been engaged in “reactive action” to ensure the risks of blackouts were reduced during the summer peaks.

But she said the current methods of securing additional resources were imposing higher costs on consumers. Zibelman said that while the actions Aemo had taken to shore up power supply were allowed for under the energy market rules, the higher costs they were imposing, as well as the ongoing risks to reliability, were “not sustainable over the longer term”.

The Aemo chief has called for “deliberate actions that address the challenges of our ageing coal fleet and which meet the need for secure and dispatchable supply, while also taking advantage of Australia’s natural resources”.

“We need to harness all the resources we have in the system, together with the opportunities that come with the technological advances occurring in the industry to meet current and future energy demands at the lowest cost possible.”