Minister for Energy and Emissions Reduction Angus Taylor this week announced the news, revealing Shine Energy's proposed 1GW HELE project in Collinsville is among a series of projects set to receive initial funding.
As part of the Morrison government's $10 million Supporting Reliable Energy Infrastructure program, it is hoped the study will highlight the project's "affordable and reliable" outcome for users.
However, the significant boost is not the first attempt to secure funding for the research.
Central Queensland's National Party politicians including Capricornia MP Michelle Landry worked to secure $4 million earlier this year in support of the same study. That figure was last week dropped to the now $3.3 million total.
HELE technology - the coal burning method which underpins the LNP's new power station plan - is expected to reduce energy prices and improve reliability across regional Queensland.
Minister Taylor said new energy generation in Central and North Queensland is key to driving down prices and bolstering system strength - something he claimed has historically proven a concern in the region.
"Our plan to unlock investment in new, reliable generation capacity in Queensland will keep the lights on and lower prices to better support households in North Queensland and our commercial and industrial sector so they can employ more Australians and keep our economy strong," he said.
Federal Member for Capricornia Michelle Landry welcomed the development, saying proof of the Australian Government's support for the coal industry was further cemented following its latest investment.
"I'm pleased that the Australian Government is supported these two worthwhile and integral feasibility studies for the Urannah Water Scheme and Shine Energy's HELE coal plant."
"These two projects stand to deliver lower energy costs for hardworking regional Australians and will provide a boost in local job numbers," Ms Landry said.
$2 million in funding for a pre-feasibility study on a proposed 1.5GW pumped hydro-electric plant at the Urannah Water Scheme has also been approved under the program.