Snowy Hydro will stay in public hands, though whether those hands are in Sydney, Melbourne or Canberra is up for discussion.
Treasurer Scott Morrison says the federal government has big plans for expanding the hydro-electric plant's capacity but it also wants to offer NSW and Victoria the chance to free the capital they have tied up in Snowy Hydro now.
The states would have to put any federal funds in exchange for their share of the Snowy scheme into other infrastructure projects.
Speaking of the plans to expand the scheme's capacity by up to 50 per cent - subject to a feasibility study under way - Mr Morrison said the cabinet table knew Prime Minister Malcolm Turnbull was a "frustrated engineer".
"No one knows more about pumped hydro in this place, I suspect, than the prime minister," he told the National Press Club during his post-budget address on Wednesday.
"I was in Queenstown for the meetings with the New Zealanders and Arthur Sinodinos and I travelled to a meeting ... looking around the mountains and hills and I said, 'I betcha the prime minister is seeing pumped hydro stations around these hills'."
Snowy Hydro was the gold standard of nation-building infrastructure, he said, and its day was coming again because of the need for more storage capacity in Australia's energy network.
The treasurer was asked how the possible federal buyback of the scheme tallied with the Liberal view of government, given John Howard toyed with the idea of selling it altogether.
"It will stay in public hands," he said.
"The link between John Howard and Malcolm Turnbull is they are both prime ministers just focused on getting things done."
