It is not mandatory, you should be using this only when you need source of the radius access request messages to be be the TWAG itself, not the controller or the AP's.
Be careful if you are using 9800 controllers as one of the deployments as Radius proxy is not working as expected in few releases in 16.12.X, I am yet to test this in 17.3.X. If you have please let me know how it goes.