Their concerns come after a Telstra manager reportedly said the company was "not an emergency services organisation" and that it had "no obligation to deliver a network for safety purposes".

Residents told The Age they wanted the tower, proposed for the main street of the town of Glenlyon, near Daylesford, to be built on a hill about 2.5 kilometres away, which they say would serve more people and improve safety.

In an email to the office of the Emergency Management Commissioner, the captain of Porcupine Ridge CFA said the location decision may have been made for economic reasons.

"This location is too low to provide mobile coverage to areas which have been identified in the black spot program, such as Porcupine Ridge, Wheatsheaf and Coomoora, not to mention parts of Glenlyon itself," Rob Hands said.

"My concern ... is for the safety of my community, and it appears that the decision has been made regarding the location of the tower for economic reasons, when the Gooches Hill location will give greater coverage to more areas at greater risk of fire."

In an October email to Donna Kelly, editor of news magazine The Local, discussing mobile coverage, Telstra's Bill Mundy reportedly said the company was "not an emergency services organisation and doesn't have a responsibility to provide for your individual safety by way of the delivery of a mobile network".

He also said: "People get confused that since the state government has made a decision to deliver emergency warning messages over the mobile network that it is our responsibility to provide the network to deliver the messages, well that just isn't true, since we have no obligation to deliver a network for safety purposes."

Wheatsheaf resident Tricia Dunlop, who lives on the edge of the Wombat State Forest about three kilometres from Glenlyon, said she wanted the tower on top of Gooches Hill.

"It's great that they're considering a tower, it's just the wrong location to be able to service the entire area," she said.

"It's a high fire-risk area. We get no warnings via the mobile warning system, we can't access any of the apps that are supposed to give us a warning. So really, we're stuffed. And actually on the weekend we had no landline phone. For some reason the phones went out in this area."

A statement from Telstra said that under the guidelines for the Blackspot Program the company "was asked to identify communities where the best coverage could be achieved for people living in them. Other locations that have been suggested by some in the community to nearby hills may increase coverage to more communities. However, this coverage may be intermittent and not as reliable as building it in town.

"The goal of the mobile black spot program was to provide reliable coverage to towns and communities where there previously was none. Moving the base station from Glenlyon to surrounding areas does not achieve this."

The statement also said there were "a wide range of factors that determine where existing and new mobile base stations are located, but it's especially important to locate the sites as close as possible to the customers the site is intended to serve".

In June this year 499 new and upgraded mobile base stations were announced by the federal government to share in a $100 million project to fix coverage.

Telstra and Vodafone are also contributing to the scheme, and the Victorian government is providing $21 million.

Telstra is paying $165 million over three years as part of the national scheme.

Glenlyon was chosen as one of 109 blackspot locations in Victoria to receive a new tower, or have an existing tower upgraded.

The Victorian government said it had been working with Telstra on the latest round of blackspot funding to ensure the biggest areas could be covered by new towers. A spokeswoman said Victorian submissions to the national blackspot program were based on the most area that could be covered.

A spokeswoman for Communications Minister Mitch Fifield said there was no legislative requirement for carriers to achieve specific coverage targets, but in a competitive environment, it was in their interests to provide coverage in areas where people expect to receive it.

"Mobile phone coverage currently covers approximately 99 per cent of the population and 30 per cent of the landmass. Clearly there are black spots which is why the Australian government has committed $160 million to the Mobile Black Spot Program," she said.

She said the first round saw $100 million from the federal government leverage co-contributions of $285 million from telcos, states, local government and third parties which will lead to the 499 base stations covering 3000 black spots around Australia. The second round of $60 million in Commonwealth funding will open shortly.