Australia's trajectory has the nation falling short on the 2030 emissions reduction target, officials have warned energy and climate ministers.
Commitments including a national 82 per cent renewable electricity target and new vehicle efficiency standards are not enough, according to a communique released on Friday after a ministerial summit.
Federal Energy Minister Chris Bowen said millions of consumers also need to get more value out of the energy they own - on their rooftops or when driving electric cars - in a system not yet able to make the most of these assets.
"We have an enormous amount of work to do to ensure our system is designed for customer-owned energy," he told reporters in Canberra.
Residential and small business energy users welcomed the announcement of a consumer-focused reform package to be signed off by ministers when they next meet in July.
Energy Consumers Australia CEO Brendan French said many people were consumers and suppliers, and they should be fairly rewarded for the generation, energy storage and services they provided to the system.
There was also a growing divide in the energy transition between people who own their own home and people who rent or live in share houses and are on low incomes, he warned.
Ministers are also implementing all nine recommendations of a recent review that criticised energy developers, planning and environmental approvals.
An alliance of community groups working with regional economies for the past decade said investing in trust was just as important as spending billions on projects.
RE-Alliance national director Andrew Bray called on the federal government to invest in regional energy hubs as a "one-stop-shop" for communities to understand the need for new infrastructure.
But ACT Energy Minister Shane Rattenbury said "inconsistent and detrimental actions" by the states were undermining work on electrification, including a gas phase-out in the territory and the highest uptake of EVs in the country.
"Governments must stop approving new fossil fuel projects, whether coal or gas," he said after hosting the ministerial council of federal, state and territory ministers.
Officials warned that emissions are projected to be 42 per cent below 2005 levels in 2030 - just short of the 43 per cent target needed to reach net zero by 2050.
Climate and natural hazards are also increasing, bringing life-threatening blackouts and challenges for those working - often across state lines - without enough information on how to reduce to disaster risks.
Time is running out to finalise a capacity investment scheme that is intended to underwrite an additional 32 gigawatts by 2030, with a tender process set to begin in May.
Separately, independent economic analysis dismissed fears of an inflationary hit from a massive spend on the future energy system, including an ongoing role for gas.
Co-authored by former central bank deputy governor Guy Debelle, the latest modelling estimated the shift to renewable energy and green technology would require $625 billion over three decades.
Significant investment is required and it's not a choice between investing in renewables or doing nothing, according to the report published by the independent Centre for Policy Development.
Researcher Toby Phillips said about 12 gigawatts of coal and gas power would retire by 2030, and there were not enough projects coming online to replace it.
Some 38GW will have gone by 2050 as fossil fuels are phased out, even as the Australian Energy Market Operator expects demand to significantly increase as the nation electrifies.
Put together, there is a gap of almost 60GW that needs to be filled by 2050, the report warns.
The research also found unshackling Australia’s electricity from fossil fuels would bring more economic stability than replacing existing gas and coal generation with more of the same.
Replacing and meeting new demand with fossil fuel-powered generation was estimated to cost $400 billion, but would leave Australians at the mercy of volatile global markets.
