It is expected to reach 2.6 million premises by year's end.

About 4000 premises in Dubbo's central business district and parts of North, South and West Dubbo went live on Wednesday. All of Wellington was also switched on.

The federal Minister for Communications Mitch Fifield told Fairfax Media the Turnbull government acted to make the rollout of the NBN faster and more efficient.

"We know that many Australians want better internet service and they expect the nbn rollout to reach them as soon as possible," Senator Fifield said.

"Hitting the two million milestone clearly shows we have put the nbn rollout back on track. Construction is now at a scale that will allow the broadband network to reach more than five million homes by the middle of next year.

"Only the Coalition's plan for the nbn keeps broadband affordable. Under Labor, the nbn was a mess, it was a gold-plated approach and the rollout was at snail's pace."

The company's chief network engineering officer Peter Ryan said in a few months one in four homes would be able to order an NBN service.

"We know the network is changing people's lives, in some cases taking neighbourhoods with little or no broadband to enabling people to better run their businesses, access health services online, improve their children's education and enjoy new online forms of entertainment," Mr Ryan said.

"By mid-2016, around one in four homes will be able to connect to the nbn network. By the end of June next year, that number will be around one in two meaning half of Australia would be able to order a service."

But, the NBN is bleeding money and the Turnbull government's $29.5 billion cap on public funding for the national broadband network is set to run out by the end of the 2016-17 financial year, budget papers reveal.

NBN has already begun tapping the private sector to make up the $16.5 billion to $26.5 billion shortfall, a year earlier than planned.

"NBN is currently undertaking the necessary preparatory work on the proposed debt raising," the budget's Statement of Risks said.

The final $8.8 billion tranche for fiscal 2016-17 includes $400 million initially allocated for the current financial year.

To cancel the project altogether would cost $9.4 billion, the budget documents show.

The initial estimate the Coalition made for peak funding of the NBN rollout prior to its election in 2013 was $29.5 billion.

Since then the cost estimate for the infrastructure project has risen twice, to $41 billion following the government's post-election NBN Strategic Review and then to a range of $46 billion to $56 billion in the NBN's current corporate plan.

Opposition leader Bill Shorten confirmed last month that, if elected, it would move to a "hybrid" rollout of the NBN, with more fibre, rather than reverting to its previous policy.