Uncertainty over funding to reduce nitrogen discharges into Lake Taupo is expected to be a key talking point when the Government meets the Waikato Regional Council today.

Council chairman Peter Buckley will sit down with Treaty Negotiations Minister Chris Finlayson and has confirmed the Lake Taupo Protection Project was on the agenda.

Mr Buckley said the lake project was "of national significance" and the council was keen to explore all funding avenues with the Government.

In 2007 the regional council, together with Taupo District Council and the Crown, agreed to jointly fund the Lake Taupo Protection Project.

The parties also established the Lake Taupo Protection Trust and tasked it with reducing nitrogen discharges into the lake by 20 per cent.

A recent review of the project found it was working well but said the project's nitrogen reduction target had to be increased from 153 tonnes a year to 183 tonnes.

Removing the extra nitrogen is expected to cost about $12 million.

Under the current project agreement, $72.4m is available for purchasing nitrogen.

Although both councils have said they can fund their share of the extra $12m, the Government, which provides 45 per cent of the trust's funds, has held off committing further funds.

The Lake Taupo Protection Project joint committee will meet in Taupo on Thursday but in his chairman's report, Lake Taupo Protection Trust chairman Clayton Stent said the trust remained in "good heart" and looking forward to completing one of New Zealand's biggest environmental projects.

Mr Stent said although the trust's three funding parties had committed to seek funds to complete the project "as of this date there is no resolution to this issue".

"While overall the trust continued to make progress this year the uncertainty of funding has not been conducive to seeking further nitrogen reductions or for undertaking a review of our strategic approach to achieving our goal."

Mr Stent said another factor affecting the trust's operations was the significant fall in New Zealand and international carbon prices.

The fall in the price of carbon had made creating a business case for converting higher nitrogen leaching pastoral land into forestry with a carbon offsetting income more difficult, he said.

To date the trust has completed agreements to achieve nitrogen reduction of 131 tonnes and was well advanced in negotiating a further 14 tonnes.

Mr Buckley said the fall in carbon prices had not affected the council's commitment to the project's targets.

Regional councillor Jane Hennebry said it was concerning the Government had held off committing further funds and was adamant ratepayers shouldn't bear any more cost.

"What I would say is if the Government doesn't think the Lake Taupo project is core business then the council shouldn't think it is its core business either."

- © Fairfax NZ News

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