Illawarra floated as site for NSW's second desalination plant

The news comes as Water Minister Melinda Pavey announced a fast-tracking of capacity at Sydney's Kurnell plant.

At present the plant provides 15 per cent of Sydney's drinking water - the expansion would see that double.

"We need to be as prepared as we can so we aren't left flat-footed should this drought continue - which is why we are looking at this as one of Sydney's insurance policies," Ms Pavey said.

Wollongong Lord Mayor Gordon Bradbery said Water NSW has spoken to council about the proposal.

However, he said it was in the very early stages and contingent on whether increasing capacity at Kurnell provides sufficient water.

"[The plant] will be progressed in the mid-year if the present drought and rainfall conditions continue," Cr Bradbery said.

"That's when they'll look to ramp up their design of it and the feasibility.

"They're looking at options and the Illawarra is one of those options."

Ms Pavey said the government was "looking at a range of options to improve water security".

"We are proactively doing the work we need, and investigating all options, to support the people in the Illawarra get more water security for their communities," Ms Pavey said.

"We want to reassure the Illawarra they are an important part of our future plans to improve water security across the state, particularly as the severity of the drought increases."