Prime Minister Malcolm Turnbull has left the door open to taxpayers supporting the construction of new coal-fired power generation, settling a fractious backbench but potentially jeopardising bipartisan support from the states for the National Energy Guarantee.

Mr Turnbull signalled his backing for the Australian Competition and Consumer Commission's key recommendation that Canberra help underwrite the cost of new dispatchable electricity generation, as fossil fuel advocates seized on the proposal to justify their case for further investment in coal-fired power stations.