NYE threat in fight to save harbour's last working port

New Year's Eve celebrations could lose their spark and congested roads become further clogged with trucks if the final remnant of what was once a major working port precinct closes.

Closing Glebe Island port on the western side of Sydney Harbour to develop the prime waterfront site for housing would be devastating, a newly formed alliance of businesses and industry groups has warned.

"It will have severe and permanent consequences that would forever change the nature and purpose of this world-famous harbour," Sydney's Working Port Coalition warned in a letter to Premier Chris Minns and cabinet ministers.

Banks Events producer Adam Huie warned major undertakings like the city's famous New Year's Eve fireworks needed space at the port to set up.

"If we lose Glebe Island we won't have anywhere to bump these things in," he told reporters on Wednesday.

Cement and Concrete Aggregates Australia chief executive Michael Kilgariff said 40 per cent of cement coming into Sydney moved through Glebe Island.

"The cost increases that will flow through to housing, infrastructure, construction generally, will be quite considerable," he said of the port's potential closure.

Tourism and Transport Forum chief executive Margy Osmond said formal consultation was required about the precinct, which sits next to the White Bay cruise terminal.

"This kind of land availability on the edge of Sydney Harbour has shrunk dramatically ... we can't afford to lose any more," she said.

A station for Sydney's driverless metro work is under construction near the site, while a state government review investigates long-term options for the port.

Planning Minister Paul Scully told parliament in November no decision has been made about the site's future.

"When it comes to a multibillion-dollar investment in transport infrastructure, we should probably put a few more houses around it," he said.

The head of a major developer lobby group said the "ugly concrete" port should be used for much-needed housing.

Urban Taskforce chief executive Tom Forrest agreed the metro station would support and require more homes, calling on the government to finalise its plans.

"We are way past arguing about the merits of maintaining this port for the benefit of a few with vested interests," he told AAP.

The port managed a small proportion of building materials and closing it would minimally impact costs once other supply chains were established, he added.

"The government needs to get on with the job of finalising its plans and building new homes, entertainment and employment opportunities well before the metro is open."

Boring machines are tunnelling near the port for The Bays station on the Metro West line from Sydney to Parramatta, with a targeted opening date in 2032.

Business Sydney executive director Paul Nicolaou said housing could be delivered elsewhere on much-maligned arterial roads between Sydney's central business district and its geographic centre in the west.

"That's where you can put social housing, essential housing and affordable housing," he said.