Baseload is when a power station is continually operated, while peakload stations are only cranked up in times of need.
The commission also cast doubt on Genesis' ability to be able to run a proposed new thermal plant, except for when supply was tight.
The Government's policy to put a 10-year moratorium on thermal power generation is contained in the Climate Change (Emissions Trading and Renewable Preference) Bill being considered by the finance and expenditure select committee.
Commission chairman David Caygill said not nailing down a definition for baseload meant the law would be more flexible.
He also told the committee he thought it would be hard for companies to try to get around the law.
"If you hard-wire it into the bill then while of course legislation can be changed the chances are that over the 10-year life of the moratorium you wouldn't want to do that very often."
Mr Caygill said his organisation did not have a problem with the drive for renewable energy or the moratorium if that was Parliament's wish.
"The question of whether such a scheme would raise issues for security of supply is in one sense slightly hard to answer simply because we observe that the legislation itself suggests that is not to be the case."
The bill provided for exemptions to use thermal generation which would ensure security of supply.
Labour MP Paul Swain was concerned if there were no definitions companies would try to get around the moratorium by using those exemptions.
Mr Caygill said the commission would take the legislation seriously when granting exemptions and it was clear what the bill aimed to stop.
He did not think there was any loophole to allow plants that were plainly baseload to use exemptions.
Given the intended law he did not think there was interest in building thermal stations.
"Bluntly, baseload thermal is not high on anybody's horizon... If somebody was planning to come to the commission and argue for an exemption for a baseload thermal plant right now then a) we're not aware of and b) it's an odd thing to be arguing for given what else is going on."
National's Nick Smith pointed out Genesis Energy was seeking Resource Consent for its proposed gas-fired power station in Rodney, on the edge of the Kaipara Harbour.
He said 20 years ago Huntly was described as a peaking station and he questioned whether a new station may start out as peaking but swap to baseload.
"Doesn't it make something of a farce that a Government announces a moratorium on new thermal generation and then one of its own state-owned enterprises who believe that they can meet this exemption propose and apply for resource consent for a new 480 megawatt gas fired station?"
Mr Caygill said such a station may "have a problem" if they wanted to run it as baseload once the law passed. He doubted it would get exemptions and questioned whether it would be built.
Green Party co-leader Jeanette Fitzsimons said a company could get permission to build and run such a station if they said it was for combined use.
He doubted a company would put that kind of level of investment in the hope of getting an exemption.
Mr Caygill said: "It's just simply seems to me that's a very risky proposition in the first place."
The Commission would monitor compliance.
Ms Fitzsimons said it would deter companies from building renewable generation stations if they knew whenever spot prices got high thermal generation would kick in.
Mr Caygill said the commission's modelling said it was possible to largely rely on renewable generation in the future.
"In our view New Zealand's needs can be met and are likely to be met from renewables."
