A NSW man has been charged with a terrorism offence after police uncovered an alleged right-wing plot to attack an electrical substation on the South Coast.

The 21-year-old man from Sanctuary Point was on Saturday charged with one count of preparing or planning a terrorist act after a Joint Counter Terrorism Team investigation.

The offence carries a maximum penalty of life in jail.

The accused allegedly attempted and planned to buy or acquire military equipment including firearms and items capable of making improvised explosive devices, police say.

NSW Police Assistant Commissioner Mark Walton says officers acted swiftly because the man’s behaviour online was of “significant” concern.

“This person had anti-government sentiment, he was anti-semitic, he has neo-Nazi interests and he has anti-indigenous interests,” he told reporters in Sydney on Monday.

“It’s fair to say that the online environment is a petri dish of hate in our community.”

Australian Federal Police Assistant Commissioner Scott Lee says although the man had not finalised any attack plans, authorities became concerned by his online activity over the past week.

That included the potential testing and construction of explosive devices.

Mr Lee said the first anniversary of the Christchurch attack was a factor in the weekend arrest.

“There was no information that we had that anything would actually occur on the anniversary itself, but honestly the upcoming anniversary, the ideology and the alignment of that ideology to Christchurch was one of the factors that we took into account as to when we went,” Mr Lee told reporters.

Detectives on the weekend raided properties in the rural town of Parma, southwest of Nowra, and nearby Sanctuary Point.

Several electronic devices, tactical equipment and three paintball firearms were seized at the accused’s Sanctuary Point property while four registered firearms were taken from the Parma residence which police say is the home of an associate of the 21-year-old man.

Mr Lee said investigations are ongoing with a number of inquiries being made in Australia and with international agencies.

Mr Walton said the accused was an unassuming character who was unemployed and lived at home with his family.

NSW Police are in the process of searching more properties on the South Coast.

The 21-year-old man is due to appear at Nowra Local Court on Monday.

-AAP