The Prime Minister's backdown on energy policy has not placated some rebels in the Coalition party room who continue to criticise government policy and threaten to cross the floor.

Key points: Turnbull will propose to set energy targets by regulation

Turnbull will propose to set energy targets by regulation Some Nationals MPs concerned Opposition will increase target if they win office

Some Nationals MPs concerned Opposition will increase target if they win office Dutton plays down reports he would challenge Turnbull

The fraught debate within the Coalition has fuelled speculation about a possible leadership challenge, but Home Affairs Minister Peter Dutton on Saturday declared his support for Prime Minister Malcolm Turnbull and his policies.

Last night, Mr Turnbull capitulated to pressure from as many as 10 MPs who remained opposed to the National Energy Guarantee, dumping a plan to embed emissions-reduction targets in legislation.

To appease the critics Mr Turnbull will instead propose to set the targets by regulation, which means backbench MPs with concerns will not be forced to vote against the targets in Federal Parliament.

But that change, which is something the Labor states have been calling for, has only added to concerns from some Nationals that the Opposition will simply ratchet up the target from 26 to 45 per cent if they win office.

Government frontbencher and Nationals MP Keith Pitt has repeatedly refused to rule out quitting his role to oppose the policy on the floor of Parliament.

Nationals Senator John Williams said he was "very concerned" by the change, as it would allow Labor to easily increase the emissions-reduction targets if it won office.

Nationals MP Andrew Gee repeated his threat to cross the floor and said he was frustrated Labor had been provided with more details than backbenchers.

"I have been raising my concerns for a number of days and no-one has contacted me with any other proposals or any detail of anything on the table," he said.

Nationals MP George Christensen said the Government appeared to have reacted to backbench concerns, but did not think the changes "went in the right direction".

Liberal MP Craig Kelly, who has been one of the most vocal critics of the policy along with former prime minister Tony Abbott, said the policy could "make things worse, not better".

Sorry, this video has expired Craig Kelly says not legislating emissions makes NEG worse — not better

Mr Abbott told 2GB dumping the plan "for God knows what reason" would "just let an incoming Labor government come in and be able to increase [the target] willy-nilly, which is the last thing we should be doing".

"I've got to say that it's no way to run a Government — making absolute commitments on Tuesday and breaking them on Friday," he said.

Only this week, Mr Turnbull fiercely defended the plan to legislate the Paris targets, saying to do otherwise would deny Parliament "a voice".

Dutton reaffirms support for PM

After days of speculation, Mr Dutton released a statement on social media playing down reports he was considering calls to challenge Mr Turnbull.

The Daily Telegraph reported on Saturday some Coalition MPs expressed their concerns about the Government's fortunes, and that they would support Mr Dutton if he did make a move.

Mr Dutton says he supports Mr Turnbull and his policies. ( ABC News: Adam Kennedy )

"In relation to media stories today, just to make it very clear, the Prime Minister has my support and I support the policies of the Government," Mr Dutton said.

On Thursday, Mr Dutton gave an interview that raised some eyebrows because he said if he did not agree with a policy then he would resign.

But senior Coalition figures said he was merely explaining cabinet process, rather than an intention.

Former deputy prime minister Barnaby Joyce also supported the Prime Minister on Saturday, saying he did not believe there should be a change of leadership.

"I think that Malcolm is what we need to try and make sure we get a steady ship and that's precisely what I want," Mr Joyce said.

"I didn't support Malcolm getting rid of Tony [Abbott], I thought it was stupid Julia [Gillard] getting rid of Kevin [Rudd], and I thought Kevin getting rid of Julia looked even more dopy.

"When you start chopping and changing like that … it really should be the realm of the person who holds the office, not the realm of others."

Turnbull has lost control: Butler

While the proposed change has concerned some Coalition backbenchers, it's been welcomed by Federal Labor.

Shadow Energy Minister Mark Butler said the Federal Government was unravelling over energy policy, with internal divisions now becoming public.

"A series of humiliating backflips and backdowns by a Prime Minister who has completely lost control of his own Government — a Government that is an utter shambles," Mr Butler said.

Federal Labor has not declared whether it will support the National Energy Guarantee in Parliament, but Mr Butler said setting the targets by regulation was a good idea.

"This is not a Government idea, Labor has been arguing this point now for weeks," he said.

"It will make it easier for a future Labor Government, or frankly a future Liberal Government that is not beholden to the hard-right, to lift these targets in the future as inevitably will be required," he said.

Government pushes back on 'stroke of pen' criticism

Deputy Prime Minister Michael McCormack said if a minister did want to increase the emissions-reduction target by regulation, it would not be a simple process.

Nationals leader Michael McCormack and deputy leader Bridget McKenzie were at the Nationals' federal council in Canberra. ( ABC News: Mark Moore )

The Government would first need to ask the energy regulator and the consumer watchdog to prepare a report on how that decision would impact on power prices.

The minister would also need to give a statement to Parliament explaining the decision, which would then be debated.

"It would have to go to the public to explain what, if any, difference that would make," Mr McCormack told the ABC.

"Of course if you increase the emissions target, you are going to increase prices."