Victoria will set a lofty target of achieving no net greenhouse emissions within 35 years.

Key points: Victoria will need to cut reliance on brown coal to meet target

Victoria will need to cut reliance on brown coal to meet target Australian Industry Group says coal-fired power still required

Australian Industry Group says coal-fired power still required Environment Minister says policy will be a "springboard" to low-carbon economy

The State Government will legislate for a series of five-yearly interim targets, which it hopes will lead to the overall goal of achieving net zero emissions by 2050.

But to do that, the state will need to eliminate its reliance on brown coal energy producers.

"Climate change is very real and climate change is very dangerous," Premier Daniel Andrews said.

"Victoria is once again leading the nation when it comes to tackling climate change."

While welcoming the targets, the Australian Industry Group has warned coal-fired power stations will still be required.

"We need base load power in Victoria and in Australia for that matter so coal-fired power is going to be with us for quite some time yet," AI Group's Tim Piper said.

"It's a matter of improving on what we've got at the moment and perhaps looking at the practicalities of what's in the [Latrobe] Valley at the moment."

Environment Victoria wants to see the state begin to move from coal-fired power to clean energy over the next couple of years.

"It's really important that we have a target for ending climate pollution for Victoria," Environment Victoria chief executive Mark Wakeham said.

"That sends a very strong signal to government and to business that we need to be making decisions that start reducing greenhouse pollution.

"We need to be looking to phase out coal burning power stations like Hazelwood."

'Springboard' to low-carbon economy

As well as the five-year targets, the State Government will introduce an emissions reduction pledge program for business and community sectors.

Every government department will be required to pledge to reduce their own operational emissions, while government policies and programs will also have to consider climate change.

"We will use this as the springboard for Victoria's ongoing long-term shift to a low-carbon economy," Energy and Environment Minister Lily D'Ambrosio said.

"It will also provide the confidence for communities to be able to plan and invest in an orderly way as we move towards reaching our ultimate goals."

It follows a review of the state's Climate Change Act, which recommended the Government take three years to develop its first interim target.

Instead, a mandatory target will be implemented immediately with the Government to decide on its first steps by the end of the year.

Mr Andrews wouldn't say what costs would be involved in achieving the ambitious targets.

"The cost of doing nothing is much, much bigger than any investments that we might make and will need to make," he said.

"We'll have more to say when our pledge — our detailed plan in action and in policy, is properly released toward the end of this year."