Morwell residents are considering legal action against the owners of the Hazelwood open-cut mine as a fire continues to belch smoke and ash across the Victorian town.
More than 400 locals are expected at a rally on Sunday to demand compensation from mine owners GDF Suez Australian Energy, as well as extra resources to put out the blaze.
Organisers will use the event to gather information on health issues and the financial impact of the fire, which will form the basis of a potential class action.
A rally organiser, Nerissa Albon, said part of the mine that's ablaze was supposed to be capped to prevent fire.
She said she had visited a solicitor about legal action on behalf of Morwell residents.
"I was advised to have a class action or royal commission, that we need to have data from the people of Morwell," Ms Albon said.
"We want to be compensated for loss of earnings, compensated for health issues over the last two weeks."
The Hazelwood blaze began after three fires were deliberately lit along the Strzelecki Highway near Morwell on February 9, which then spotted into a worked-out area of the mine.
A GDF Suez spokesman was not available for comment on Thursday, but the company has said it is co-operating with all agencies to address the impact of smoke on nearby communities.
In a statement on Wednesday, GDF Suez said fire activity had more than halved since the fire reached the mine, but in order to reduce the amount of smoke, the blaze must be extinguished.
It says the mine rehabilitation program is ongoing and part of an approved works plan, and a large section of the worked-out areas have been fully rehabilitated with vegetation.
Ms Albon says GDF Suez representatives have been invited to attend the rally.
