The Power board met for nine hours on Monday before agreeing to begin negotiations with their 2004 premiership coach about a two-season extension.

Williams - who had a clause in his current deal requiring the club to give an indication on his coaching future by June 30 - was told of the board's decision by president Brett Duncanson and chief executive Mark Haysman at his home late on Monday night.

After the extension was announced, Williams thanked the club and the players for supporting him through a time of great speculation and doubt about his future.

"It's certainly my honour to have the opportunity to continue coaching here," Williams said on Tuesday.

"Without the players' support there'd be no point, the board wouldn't even give me the opportunity and I wouldn't want to be here if I didn't feel like I had total support from the players and the staff around.

"The last six months have been pretty tough, to be under the microscope for that length of time.

"From my point of view the club with their new management wanted to find out if I was the person portrayed in the media, and they've given me a fair hearing if you like, found out for themselves what I'm like."

Duncanson said Williams remained the best and most likely man to coach the Power to their next AFL premiership and all that remains is to tie up the details of a deal that will feature a pay-cut.

"We are entering a negotiation period and that negotiation will be conducted in good faith and be confidential," Duncanson said on Tuesday.

"Mark Williams has an outstanding coaching record and is a proven teacher of young players.

"He is highly respected at this club and in the football community.

"At the end of 2006 the club put in place a five-year plan and we are halfway through that period.

"Mark deserves an opportunity to see that plan through.

"We have turned over our list by 50 per cent over the last three years, including 12 new arrivals this year.

"At the same time as we are developing our list - and we know there will be ups and downs with that - we are still a very good chance to play finals.

The only other current coaches still out of contract for 2010, Collingwood's Mick Malthouse and the Western Bulldogs's Rodney Eade, are also expected to be offered new deals by their current clubs.

That leaves Richmond and North Melbourne as the two clubs looking for new coaches for next year.