The Victorian Government has undertaken consultation as part of the development of its second Climate Change Strategy.

Climateworks commends the ambitious climate action and commitments taken by the Victorian Government to date.

It is particularly laudable that the Victorian Government brought forward and legislated its commitment to achieve net zero from 2050 to 2045 and that this target is underpinned by legislated interim targets as well as sector pledges that outline priorities for specific parts of the economy.

To maintain this positive trajectory and meet Victoria’s existing climate targets, aligned to limiting global warming to below 1.5 degrees Celsius, Climateworks recommends that the Victorian Government take the opportunity of renewing the five-yearly sector pledges to develop robust and specific sector plans for 2026–2030, underpinned by detailed implementation plans.

The implementation plans could be linked and complementary between topics, support elements of relevant extant Victorian Government plans and policies such as the Adaptation Action Plans (Victoria State Government, 2025) and could be flexible and iterative to ensure they are fit-for-purpose and adapt to inevitably changing circumstances on the pathway to net zero by 2045.

Developing and implementing sector specific plans complementary to other relevant policies is especially urgent given the window to keep global warming within 1.5 degrees is still open, but narrowing.

Submission summary

Climateworks recognises the importance of Victoria’s Climate Action Act 2017 and legislated processes to set targets and release regularly updated strategies and sector pledges.

To improve Victoria’s ability to meet its emissions reduction and energy targets and make the most of economic opportunities from transition, Climateworks recommends that the Victorian Government:

  • Set out its forthcoming sector pledges by economic sector, in line with the sectoral plans currently being developed by the Australian Government. These sectors are electricity and energy, industry and waste, resources, transport, the built environment, and agriculture and land
  • Set indicative targets for sectors and key technologies as part of sector pledges to signal the relative contribution of different parts of the economy to meeting Victoria’s net zero goals cost-effectively and to aid with tracking and implementation
  • Underpin the Climate Change Strategy and sector pledges with robust implementation plans that identify barriers and enablers, including policies and other interventions. Such an implementation plan could set out how the government intends to reduce emissions over the next five years to at least meet the short-term 2030 target and ensure that the economy is on track to meet medium to long term targets cost-effectively
  • Convene stakeholder groups in each sector to advise on barriers and enablers, and assist with identifying policies to support and accelerate implementation
  • Outline a whole-of-government pledge and action plan that addresses all government-related emissions and considers the broader impact of procurement in enabling emission reduction activity.

Climateworks recommends the following actions and policy interventions to underpin the Climate Change Strategy, set out below by sector and in detailed in subsequent sections.

In the built environment sector:

  • Align retrofit and household electrification programs to unlock the least-cost opportunities to meet Victoria’s legislation emissions reduction targets
  • Prioritise legislation and implementation of all future National Construction Code (NCC) updates, including all energy efficiency requirements, and ensure improvements to energy efficiency requirements in new buildings are aligned with the Trajectory for Low Energy Buildings
  • Upgrade Victoria’s existing residential building stock to be ‘climate-ready’ and fully electric.

In the transport sector:

  • Continue to accelerate electric vehicle (EV) uptake
  • Implement a freight decarbonisation strategy for Victoria
  • Support and provide targeted incentives for small to medium freight businesses to transition to zero emissions freight vehicles
  • Set an implementation target and plan to increase public transport mode share
  • Put in place an implementation plan for achieving Victoria’s target for increased active transport mode share
  • Prioritise funding to lowest emissions infrastructure investment
  • Work collaboratively across jurisdictions on reforms to support transport decarbonisation, including via the Infrastructure and Transport Ministers.

In the industry sector:

  • Plan for significant growth in low-carbon industries, transforming Victoria’s industrial output to be driven by renewable electricity
  • Enable an industrial energy transition that improves the competitiveness of Victoria’s products, building demand for green products in which Victoria has existing advantages
  • Require recipients of government support to apply a ‘net zero filter’ as a way to support Victoria’s emissions reduction targets
  • Establish and develop net zero industrial precincts for regions where multiple large energy users are co-located.

In the land and agriculture sector:

  • Adopt a systematic approach to land use that considers competing land functions and seeks to optimise economic, social and environmental goals
  • Consider repurposing agricultural and industrial land, including through reforestation and restoration
  • Reward good land stewardship through the provision of incentives, including subsidies and grants.

In the electricity and energy sector:

  • Enhance and broaden Victorian Government programs designed to support distributed energy resources and demand management technologies
  • Develop a comprehensive plan for the orderly phase-out of Victoria’s reticulated gas network.

To achieve strong implementation across sectors, the Victorian Government can strengthen government climate literacy and decision-making by taking the following actions:

  • Embed climate goals in Victorian Government processes and decision-making
  • Leverage government procurement power to support new green industries, strengthen data collection and reduce value chain emissions.

More details can be found in the submission.