New figures from the Australian Energy Market Operator show emissions from electricity generation have fallen since the carbon tax was introduced.
Victoria has recorded an 8.7 per cent drop in emissions intensity, the second biggest in the country after South Australia.
Nationally, emissions intensity has fallen by 7.6 per cent.
The Parliamentary Secretary for Climate Change, Mark Dreyfus, says the report demonstrates that the carbon price is working.
“You have to read the report and it shows that Australia’s cutting carbon pollution, which is good for the environment,” he said.
“It’s a sign that we are beginning to make the change to a low carbon, clean energy economy.”