Despite record high electricity prices and disconnection rates the state government has underspent by more than $22 million a key rebate aimed at cushioning the impact of soaring power bills on NSW families.

The revelation has prompted the state's peak welfare agency to call for a review of the rebate system as millions of dollars in assistance are going unused.

Energy Minister Anthony Roberts said 49,178 applications for the rebate have been received for 2014-15, Credit:Dean Osland

The Family Energy Rebate was introduced in July 2012 and was to be funded from savings flowing from the creation of Networks NSW to run state-owned electricity companies Ausgrid, Endeavour Energy and Essential Energy.

Families eligible for the Commonwealth's Family Tax Benefit Part A and B can apply for the rebate, which began at $75 and rose to $125 in 2013-14 and to $150 this financial year.