Moderate Liberals have clashed with Nationals colleagues over the future of coal-fired power.
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The Morrison government promised during last year's election campaign to fund a feasibility study into a new coal-fired power plant in north Queensland, writing a cheque for up to $4 million.
While the Nationals are spruiking the Collinsville project's job-creating potential, some Liberals say it doesn't stack up.
Sydney MP Jason Falinski says there are better energy options.
He thinks the feasibility study should still go ahead because it was an election commitment.
"But it will not lead to a new coal-fired power station being built," Mr Falinski said on Wednesday.
"There are more economically efficient and environmentally cleaner options for power generation in Australia."
Sydney Liberal MPs Dave Sharma and Trent Zimmerman have made similar comments, saying new coal-fired power stations don't stack up.
Labor is trying to stop the feasibility study through a disallowance motion in the Senate, with the support of the Greens.
The federal opposition has also asked the auditor-general to investigate the grant, after revelations Shine Energy was asked to apply for the money after the government had announced it was successful.
Labor agriculture spokesman Joel Fitzgibbon - who has stoked tensions in his own party by saying it's divided on energy policy - believes the government is using the feasibility study as a political tool.
"They want the Labor Party blocking the feasibility study and so we never know about the feasibility and they can claim Queensland could have had a new generator if it were not for the Labor Party," he told 2CC radio.
Mr Fitzgibbon says north Queensland doesn't need more energy supplies, as it sends excess power to NSW.
He says gas will be needed as a transitional fuel as systems move towards renewable sources.
"Renewables cannot possibly get to 100 per cent, probably in my lifetime," Mr Fitzgibbon said.
Australian Associated Press
