Carbon tax end to boost public funds: Vic

The repeal of the carbon tax will free up public funds needed to pay for essential services and transport, Victoria's premier says.

Denis Napthine also said it would also result in lower electricity and gas prices in a "relief to households and businesses across Victoria".

"In the carbon tax era, we saw the cost of electricity to drive our public transport system - particularly metro trains - to drive our trams, and for the energy cost of our hospitals, they had the carbon tax impost on them," Dr Napthine told reporters in Melbourne on Thursday.

"That was an impact on our basic services that affected all Victorians and with the removal of the carbon tax, that will free up those resources."

Dr Napthine also said the Victorian government supported retention of the target of 20 per cent of the country's electricity coming from renewables by 2020.

It was important to strike the right balance between renewable electricity generation, he said, and "brown coal reserves ... that give us affordable energy to drive our future".