The government owned energy supplier had announced two separate lots of jobs cuts since the beginning of July, with a 682 jobs to be slashed from regional NSW.

The announcement drew condemnation from politicians and business leaders who said the drought-affected state would be severely impacted.

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After weeks of demands for Essential Energy to halt the cuts, it announced on Tuesday that it would.

The announcement came following a meeting on Monday between the supplier and NSW Government ministers.

"Following the meeting, Essential Energy has been directed to place on hold the current workforce reshaping process and consider alternate options for savings," a spokesperson for the supplier said.

It would, however, continue to deliver "operational efficiencies" and lower network charges for its 855,000 customers as required by the Australian Energy Regulator.

"Essential Energy will provide information on alternate options for savings to the government when finalised and work with the government to implement its decisions," the spokesperson said.

NSW Deputy Premier John Barilaro said the decision was halted "thanks to the NSW Nationals in government".

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"We worked with stakeholders, we listened to communities, we stayed firm on our position and we've now achieved a major victory for regional NSW," he said.

"From the start, I urged Essential Energy to find further efficiencies without job cuts and that approach has proved successful."

Dubbo MP Dugald Saunders also welcomed a halt on the job cuts and said it was thanks to the NSW Nationals that his occurred.

"For weeks myself, the Deputy Premier John Barilaro and our Nationals colleagues been calling on Essential Energy to abandon proposed job cuts, and today the state-owned corporation has finally agreed to halt their plan to take jobs away from our communities," he said.

"Labor and other minor parties have used this issue as nothing more than a political football.

"No doubt they will try to take credit for this success, without having done anything, but it was the NSW Nationals in Government who saved these jobs."

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Thirty minutes after Essential Energy's announcement to halt the cuts, Minister for Energy and Environment Matt Kean announced his "intention to issue a direction to Essential Energy to halt the proposed job cuts".

"The NSW Government looks forward to receiving Essential Energy's advice and ensuring that we support regional economies during the drought, while also providing regional customers with reliable and affordable energy," he said.

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