The proponent behind a planned major wind farm in central Tasmania has said the government's energy price cap for consumers has the potential to deter energy investors from future developments in the state.
The government has instigated a review of its energy price cap policy which will rise no higher than the Hobart Consumer Price Index for the next three years.
An options paper has been released as part of the review with six directions the government can take on the future of the cap.
Most respondents to the review have backed the replacement of the cap by a rebate scheme.
Goldwind Australia managing director John Titchen said the government's objective for the lowest electricity prices for consumers would be better managed through direct customer rebates on bills funded by Hydro Tasmania and Aurora Energy.
He said a rebate scheme would not interfere with the wholesale energy market.
Mr Titchen said any moves to cap wholesale market pricing or remove the wholesale contract pricing mechanism would undermine new generation investment in the state.
"Intervention in the wholesale electricity market has strong potential to disrupt merchant generation investment in Tasmania such as Cattle Hill Wind Farm," he said.
Energy company ERM Power's executive general manager for trading, David Guiver, said the rebate scheme was not without its problems.
Although the company also saw this as the preferred option over others, Mr Guiver said such schemes were cumbersome to administer and could increase costs to customers.
"The intent of the rebate is to protect customers from high energy prices yet they are still required to pay these prices with a compensatory claim after the fact," he said.
"This potentially imposes a financial burden on the customer as they still have to carry the costs of the energy premium for a period of time until funds are rebated."