The Victorian Labor Opposition will introduce an emissions reduction program if it wins the state election this weekend.
Labor's environment spokeswoman Lisa Neville says Victoria should play a leading role in tackling climate change.
"When we were last in government we put in place an emissions reductions target to reduce emissions; we'll go through a process with the Victorian community again to put in place a program that will actually reduce emissions," she says.
Neville says Labor will establish a $20 million fund to encourage investment in renewables.
"[The fund] will co-invest with the private sector to drive wind and solar energy, and new technologies," she says.
"We will also use the planning laws to actually encourage and promote renewable energies like wind farms in Victoria."
But Victorian Environment Minister Ryan Smith says a target would put pressure on manufacturers and industry.
He says an emissions program in Victoria means more pressure to achieve a target over and above what's been set by the Federal Government.
The debate follows the release of a Climate Council report showing Victoria is a laggard when it comes to the renewable energy sector.
According to the report, which compares the renewable energy sector in each state of Australia, Victoria has the worst policy environment for renewables in the country.
“Victoria’s new planning rules have cost the state an estimated $4 billion in lost investment and 3000 jobs," the Climate Council report says.
The report's findings were released jointly by Climate Councilor Professor Tim Flannery and Australian Solar Council CEO, John Grimes.
The report found that South Australia is leading the Australian states on renewable energy sourcing over a third of its electricity from renewable sources.
In the current climate of uncertainty created by the federal government, Professor Flannery says states have a critical role to play.
"However some states, such as Victoria and NSW, are not providing the right environment for renewable energy generation," he says.
"In Victoria, just one in 10 homes has solar panels, compared with South Australia where one in four homes have solar panels.
"Combined with the impact of current Federal Government’s attempts to weaken the Renewable Energy Target, Victoria’s restrictive policies make it the least favorable investment environment of any Australian state for renewable energy.
Even though Victoria has excellent wind and solar resources, investment has dried up."
Flannery says there were 3,700 Victorians employed in renewables at the beginning of this year. "But due to the current political climate of uncertainty, jobs are being lost," he says.
Due to its favourable policy environment, South Australia has become the most popular investment destination for renewable energy in Australia.
Since 2003, there has been $5.5 billion invested in renewable energy in South Australia, with nearly half occurring in regional areas. Grimes says renewable energy projects attract investment and create jobs in regional Australia.
"Some 21,000 people are already employed in the renewable energy industry in Australia which could increase to 32,000 with strong and consistent renewable energy policies," he says.
Farmers and landowners in regional areas who lease their land for wind turbines also benefit through annual lease payments which provide a reliable, alternative source of income and helps to “drought-proof” farms.
"Around $16.4 million is paid annually in lease payments for hosting wind turbines," he says.
Internationally, the Climate Council says Australia is lagging behind the rest of the world.
After big announcements from the US, China and Japan, the Council says Australia has become entirely isolated.
