Federal and state leaders have agreed on a plan aimed at curbing power price rises, which Prime Minister Julia Gillard says will save households about $250 a year once it is fully implemented.

The agreement, reached during today's Council of Australian Governments (COAG) meeting, does not involve the mandatory rollout of so-called smart meters.

But Ms Gillard says all states have agreed to work on options for more flexible pricing.

"We will be working with consumers to give them more options and choices about how they consumer their power," she told reporters in Canberra.

"We will be introducing rewards into the system so that big users, big businesses can moderate power loads that they put on the system during peak times.

"We will be addressing the gold-plating of the system and overinvestment in the poles and wires."

As part of efforts aimed at reducing the "perverse incentive" to overinvest in transmission lines, the Commonwealth has committed an extra $23 million to boost the resources of the Australian Energy Regulator (AER).

But some state leaders have already criticised the plan, with Victorian Premier Ted Baillieu expressing disappointment the changes to the AER do not go further.

"The Commonwealth declined to commit to an independent Australian Energy Regulator which means Victorians and Australians face the prospect of sub-optimal regulatory decisions," he said.

"This will increase pressure on energy prices for Victorian families and businesses."

West Australian Premier Colin Barnett is not convinced the plan will deliver the promised savings.

"Well there is agreement to reform it (the energy market)," he told ABC News 24.

"Whether that will provide price relief, I doubt. Maybe it will mean price increases in the future won't be as great."

Ms Gillard says the $250 savings estimate is based on a report by the Productivity Commission, although she concedes today's agreement differs from that document.

The Commission's estimate was based on a scenario where households would be required to have a smart meter.

NDIS deal

Barry O'Farrell and Julia Gillard had already reached a deal on the NDIS. ( AAP: Alan Porritt )

As expected, the COAG meeting also finalised agreements for National Disability Insurance Scheme (NDIS) launch sites.

Five states have agreed to host the sites - New South Wales, Victoria, South Australia, Tasmania and the ACT - which are due to begin mid-next year.

Yesterday, Ms Gillard announced an agreement with the NSW Government for the full rollout of the scheme from 2018, saying it would act as the benchmark for other states.

Asked when Victoria might sign up to the full rollout, Mr Baillieu said: "We'll continue to work with the Commonwealth and other jurisdictions on a sustainable outcome for the long term."

Queensland Premier Campbell Newman said he believed it would be at least two more years before his state could afford to pay its share of the NDIS.

Royal commission

The leaders also discussed the terms of reference for the royal commission into child sexual abuse, with the Commonwealth agreeing to pay the total cost of the inquiry.

Ms Gillard says even though the commission will be established under federal law, the states have agreed to formally cooperate with the investigation.

"There is a predisposition by first ministers here to issues Letter Patent," Ms Gillard said.

"What that means is that the powers of the Federal Government can be bolstered by the powers of state governments.

"So that would give the royal commission that the Federal Government is creating the maximum legal power and backdrop to get about its work."

Matter of succession

Sorry, this video has expired Succession rules up for debate at COAG

All leaders reiterated their support for changing the rules for royal succession to remove discrimination on the basis of gender or religion, but there has not been uniform agreement on how to do it.

Queensland is holding out on handing over its powers to the Commonwealth to make the change, believing there is another way of achieving the goal.

"Our view is that we will pass legislation in accordance with our position as a separate, sovereign state," Mr Newman said.

"We're a federation of states - we're going to do it the right way, the proper way."

At that point, the Prime Minister responded to Mr Newman's comments, saying the Federal Government had received clear legal advice on the issue.

"There is one crown in Australia... and that the way in which we should deal with this, the most legally effective way to deal with it, is that states would pass legislation referring to the Commonwealth the ability to make these changes to succession," she said.

"For that to be a legally effective process, all states have to do it. If one state doesn't do it, then it doesn't work."

Gonski talks

The Federal Government's proposed overhaul of school funding was also discussed, but the leaders deferred detailed discussions on the matter until next year.

Under the plan recommended by the Gonski report, each school would be given a base level of funding per student, with extra loadings to compensate for disadvantage.

Mr Baillieu said he was disappointed there had not been any "meaningful" discussion about the plan at today's gathering.

"It is fanciful to expect that this reform will be agreed in April 2013 if the Commonwealth continues to refuse to discuss the proposed funding," he said in a statement.

Ms Gillard has previously said she wanted to reach a final agreement with the states by the first COAG meeting next year.