A potential water banking and sharing system could see Newcastle foot the bill for a 30 million dollar upgrade to the pipeline between dams in the Lower Hunter and Central Coast.

The system is likely to form part of a new drought-proofing plan and would mean water could be pumped back and forth between the two regions in times of drought.

Greens MP, John Kaye says the Greens would support such a system because of its benefits to both regions and the environment, he believes it  is cost effective in comparison past plans like the Tillegra Dam and desalination plants.