The O'Farrell government says it has reduced the dividend revenue it takes from the state's electricity network by almost $100 million compared with the amount Labor budgeted for when it was in office.
And the government is forecast to receive almost $150 million less this financial year than was forecast by the previous Labor government in budget papers, the NSW Treasurer, Mike Baird, said .
Claims that the amount of money the government collects from the three state-owned power companies has increased by more than $360 million to $1 billion this year are "misleading" and "false", Mr Baird said.
Mr Baird said the government is not only delivering on its promise to cap dividend payments from the state's electricity network but is well below the forecast levels set by the former Labor government.
The last Labor budget forecast a dividend take of $903 million in the 2011-12 financial year and $1.144 billion in 2012- 13.
The actual dividend last year was $820 million, a decrease of 19 per cent, and is forecast to be $999 million this year, a decrease of 13 per cent on previous estimates, he said.
"Money received from electricity dividends is reinvested in the community to fund schools, hospitals, transport and police," Mr Baird said.
The minister for energy, Chris Hartcher, said the federal government is increasing power prices through the carbon tax.
He said the Independent Pricing and Regulatory Tribunal found green schemes, including the carbon tax, will contribute about $316 to the average annual household power bill.
Mr Hartcher said the NSW government will save money by merging the state's three electricity distributors, Ausgrid, Endeavour Energy and Essential Energy into one company.
The NSW Opposition says the electricity dividends paid to the government have increased by 56 per cent since the last year Labor was in office.
The Opposition Leader, John Robertson, said the $360 million in dividends is the equivalent of $120 extra from each household in the state.
Mr Robertson said the Premier, Barry O'Farrell, has broken his promise to freeze electricity dividend payments to his government.