In Victoria, energy used to power electricity, gas and transport produces around 90% of emissions. Victoria must change the way it generates energy if it is to meet net zero by 2050. Infrastructure Victoria provides advice to government on how to navigate the energy transition.



Moving away from coal-fired power

One of Victoria’s biggest electricity challenges is managing the eventual closure of Victoria’s 3 remaining coal-fired power stations. These stations generate most of Victoria’s electricity emissions. This must be achieved while delivering affordable and reliable low emissions replacement energy and ensuring the Latrobe Valley has a thriving economic future.

Adopting renewable energy

Around 70% of Australia’s greenhouse gas emissions are either directly or indirectly influenced by infrastructure. Victoria has legislated a new target of 50% renewable energy generation by 2030. To achieve this, electricity networks will need to adapt to 2-way flows of electricity. Electricity sources will also need to be reliable to meet demand, especially when the sun is not shining and the wind is not blowing.

Managing and reducing energy demand

Victoria only needs the full capacity of the electricity network a few times each year – usually on the hottest summer evenings – to avoid blackouts. There is unused capacity in our electricity network the rest of the time. We need to reduce the peak in demand so less infrastructure is needed. This will reduce the emissions generated by the electricity network.

Key recommendations

Support augmentation of critical electricity transmission infrastructure by 2027–28 to accommodate new renewable energy generation and improve network resilience and reliability through interconnection with other states.

In the next year, identify Renewable Energy Zones, especially in the state’s north-west, and continue to coordinate their development over the next 10 years.

Generate energy savings in existing owned and leased Victorian Government buildings through energy efficiency upgrades. Set and report against energy efficiency targets for the next 5 years to support delivery of energy efficiency outcomes, then review with a view to set a longer-term energy efficiency target.

In the next 10 years, optimise use of existing electricity infrastructure by encouraging demand management pricing.

Within a year, respond to Infrastructure Victoria’s Advice on gas infrastructure, including by considering the trajectory to transition natural gas to reach net zero emissions by 2050. This allows gas network planning changes after 2025. Adjust policies so they do not encourage or embed future residential natural gas use.

In the next 5 years, contribute toward strategic power supply infrastructure upgrades for agriculture and regional industry, where an independent assessment demonstrates significant potential for increased productivity, competitiveness and growth.