More than 690,000 tonnes of carbon dioxide was pumped out by the rail network last financial year - equating to 1.3 per cent of the state's energy load.

But Transport Minister Andrew Constance on Friday announced he is aiming to cut that to zero net emissions by 2025.

"This will be a great step forward in helping our state tackle climate change," he tweeted.

The specifics on how the target will be achieved are still being worked out, a spokeswoman told AAP, but the state will start by offsetting all emissions from stations' electricity usage by 2022.

"We are starting this process now, and are absolutely committed to reaching this ambitious goal," she said.

Smart Energy Council chief executive John Grimes lauded Mr Constance's announcement as globally significant.

However he's encouraging the NSW government to back the creation of new renewable energy projects to power the rail network instead of offsetting emissions through carbon credits.

"In that scenario, we are slashing emissions but we're also slashing the power bills and the overhead for the NSW government."

Projects would create jobs for people in regional NSW, and hopefully lead to cheaper fares for travellers.

Either way, moving the rail network towards net zero will have a huge impact, he says.

"It really does catapult NSW to the top of the table when it comes to slashing emissions in transportation."

The minister on Wednesday also announced plans to electrify some of Sydney's ferries.

The smaller, River Class ferries, which have been plagued by problems and are yet to hit the water, will be retrofitted with electric engines and batteries.

Bigger ferries, like the Emerald Class or Freshwaters, are not yet able to be electrified, as the large batteries required would sink the vessels.

Mr Constance in December announced the state's 8000 buses would be transitioned to electric vehicles by 2030.

The measures are part of Mr Constance's broader plan to electrify the state's whole transport fleet.

Australian Associated Press