The configuration of the Nix Packages collection. (For details, see the Nixpkgs documentation.) It allows you to set package configuration options.
If null, then configuration is taken from the fallback location, for example, ~/.config/nixpkgs/config.nix.
Note, this option will not apply outside your Home Manager configuration like when installing manually through nix-env. If you want to apply it both inside and outside Home Manager you can put it in a separate file and include something like
nixpkgs.config = import ./nixpkgs-config.nix;
xdg.configFile."nixpkgs/config.nix".source = ./nixpkgs-config.nix;
in your Home Manager configuration.