New technology aimed at dramatically reducing the risk of bushfires caused by powerlines will be installed across parts of Victoria's distribution network, after a successful trial.

Powerlines have been blamed for causing some of the devastating bushfires on Black Saturday, including the Kilmore East blaze which claimed 119 lives.

The technology, which works by reducing the electrical current running through a power line when it comes in contact with either the ground or a fallen tree, was trialled at Kilmore earlier this year.

The Rapid Earth Fault Current Limiter has been adapted from technology used overseas in underground cable networks.

Victoria's Energy Minister Lily D'Ambrosio said the trial showed it significantly reduced the fire risk.

"We know that through the trials we've been running, we can reduce by 10 times the likelihood of a bushfire starting from a high-voltage powerline," she said.

The Victorian Government has released regulations requiring power distributors in high risk areas to install the technology for consultation, before legislation will be introduced next year.

"These will be targeted in areas of highest bushfire danger," she said.

"It won't be right across the state, we will be targeting the areas most in need of it, where we know faulty powerlines actually caused the Black Saturday fires to start.

"That's the purpose of this, it's bushfire related and it's a direct result of one of the key recommendations of the royal commission that came out of the 2009 bushfires."

Ms D'Ambrosio said the technology would take seven years to roll out, and add a "no more than 1 per cent" increase to a typical power bill annually.

"The point is, it will save lives, it is a very small cost for the potential to avoid the terrible life and death situation that Victorians were confronted with in 2009," she said.