The announcement follows last week's proposal to cut 35 jobs from across the Orana region, including 10 out of the 124-strong workforce in Dubbo.

Essential Energy is undergoing a radical change to its workforce, including a proposal to reduce staffing numbers by more than 40 per cent, or 1395 positions, after the Australian Energy Regulator (AER) cut the electricity distributor's operating expenditure by 30 per cent in April this year.

The company's executive is currently consulting with about 3000 of its staff at 37 sites across the state, and yesterday Essential Energy's general manager of network services Luke Jenner was in Dubbo to discuss the upcoming changes with staff from Dubbo and Gilgandra.

"We're going to be combining the two offices into one," Mr Humphreys said.

"We currently have an office rented in Darling Street and in our efforts to continue to reduce our costs we're... proposing to exit the lease."

"There are no staff reductions as are result of these office consolidations."

Last week's announcement disclosed 700 jobs would go statewide under the first stage of the changes, and the proposal would see jobs lost at Dubbo (10), Mudgee (7), Narromine (3), Dunedoo (3), Cobar (2), Walgett (2), Coonamble (2), Gulgong (2), Wellington (1), Warren (1), Gilgandra (1) and Brewarrina (1).

"The AER cut our revenue by 25 per cent and if we simply don't have the revenue, we don't have the funds to pay for 1395 employees," Mr Humphreys said.

Essential Energy proposed a three-year transition using natural attrition to make staff reductions, but the regulator rejected the proposal and back-dated their decision to 1 July 2014, he said.

"The result is that we now don't have funds for 1395 employees as at 1 July this year and it's costing us over $14 million a month in unfunded labour costs," Mr Humphreys said.

"Obviously there is a significant amount of anxiety with our employees but most employees understand the need for transformation and are keen to progress as quickly as possible with these changes."

As of last week, 288 employees had already accepted voluntary redundancies, with a further 418 positions set to go state-wide by December.

Mr Humphreys said the company was endeavouring to limit the impact to customers, but said the company's ability to respond to major events, like last month's freak tornado, would suffer.

"I can't take 1395 employees out of our workforce without having some impact on services and there'll be two key areas affected," he said.

"We simply won't have the resources to respond to major events as we have in the past, so what we can expect is just longer restoration times but we'll never compromise the safety of our employees or members of the public.

"Secondly, we can no longer do a lot of our planned work on weekends because of overtime costs so we will no longer have the flexibility around when we have the planned outages."

Staff from Essential Energy's Nyngan, Cobar, Warren, Wellington and Mudgee offices were briefed on Tuesday, while staff at Narromine will receive a visit from company executives today.

Consultation wraps up on October 6, with the first phase of reductions to be completed by December. A proposal for the remaining 695 positions will be released once the outcome of Essential Energy's appeal of aspects of the AER's determination is known. This is expected in late 2015.