But Environment Minister Gavin Jennings says the way the Federal Government's proposed emissions trading scheme is designed means Victoria will not make enough money from such schemes to cover the economic losses of ending logging of old-growth forests.

In an enormous study the Victorian Department of Sustainability and Environment has found there is currently 2.75 billion tonnes of CO2e (carbon dioxide equivalent) stored in forests, soil and vegetation on Victorian public land.

Mr Jennings said yesterday the stocktake would prepare the state to sell credits into the carbon offset market and also understand the environmental and economic value of the state's public land.

Carbon offsets are created by saving carbon emissions by either replanting trees on land cleared before 1990 or not logging existing forests. A credit is then created for the saved carbon which cancels out emissions elsewhere.

Lindsay Hesketh, forests campaigner for the Australian Conservation Foundation, said the Victorian Government had propped up the old-growth logging industry with a number of subsidies which, if ended, would bring the costs closer together.

Mr Hesketh agreed the way the Commonwealth accounted for carbon stored in forests meant the full extent of their offsetting potential was not properly recognised, lessening the value of carbon stored in old-growth forests.