The New South Wales Government's plan to secure the future of a coal mine and power station west of Sydney has been met with cautious optimism by the Lithgow community.

The Springvale Mine, which is the sole supplier of the Mount Piper Power Station, was facing potential closure after the Land and Environment Court ruled that planning authorities applied the wrong test when granting its approval.

Environmentalists have long been concerned about salty discharges from the mine being released into Cox's River, which runs into Sydney's drinking water.

The NSW Government has announced it will introduce legislation in Parliament allowing the mine to remain open, saying it was vital for employment and providing 15 per cent of the state's energy.

Member for Bathurst Paul Toole said the legislation would secure more than 600 jobs in the region.

"This legislation is going to ensure that the court ruling will be non-valid," he said.

"It means that the situation will see the coal mine continuing to operate and the power stations continuing to work across the state keeping lights on."

Opposition Leader Luke Foley was in Lithgow on Monday morning and addressed hundreds of coal miners at a gathering near the mine.

Miners at the Springvale mine near Lithgow seek the support of Labor leader Luke Foley for legislation to keep the mine open. ( ABC News: Gavin Coote )

He said while he would study the proposed legislation, he supported moves to secure the mine's future.

"The Premier was in Bathurst yesterday but refused to meet with people here in Lithgow," he said.

"If it's taken my visit this morning to get the Government to pay this some attention, that's a good thing.

"I'll hold them to account this week. Parliament meets tomorrow, there needs to be a solution found this week to ensure Springvale stays open, the coal miners stay in work.

"Lithgow can sleep soundly for the first time in a long time, and the lights are kept on for millions of people in New South Wales."

'The greenies won't go away'

Lithgow's deputy mayor Wayne McAndrew said he believed Mr Foley's visit had prompted the Government into action.

"There's no doubt the visit by the Opposition Leader triggered this," he said.

"The Opposition Leader came and spoke with the most important people involved in this issue, and that's the employees of Mount Piper and Springvale and their families."

Andy Honeysett from the Construction, Forestry, Mining and Energy Union said workers remained wary about the Government's plan to introduce legislation.

"The Government hasn't come out and said anything until right now," he said.

"We've got to wait for the legislation, the fine detail, is it right?

"Will it work? Can it be appealed? The greenies won't go away, they'll still be there."

No one is trying to shut NSW down: environmentalists

Conservationists have questioned the State Government's rationale for defying the court ruling and allowing the mine to remain open.

The Colong Foundation director Keith Muir said such a move would legitimise the ongoing release of salty discharges into Sydney's drinking water.

"I don't accept the claim that environmentalists are trying to shut down Lithgow," Mr Muir said.

"We're trying to secure those laws and have them applied in an appropriate way. No one is trying to shut New South Wales down, no one wants blackouts, no one wants to throw the state into crisis.

"And I think what is happening is everyone is being manipulated into a position which is inappropriate because it will lead to more pollution of our drinking water supplies."