The body, which represents British businesses, said the UK is has lost out on estimated £4.3bn of green growth market value in Europe alone and in April will fall from 5th to 30th place in OECD table on tax competitiveness.
It urged the government to bring forward market-making mechanisms like Contracts for Difference (CfD) that have “proven success” in the renewables sector and could be applied to other technologies like hydrogen, carbon capture and sustainable aviation fuels.
CfDs incentivise investment in renewable energy by providing direct protection to developers of projects with high upfront costs and long lifetimes against volatile wholesale prices.
The government should also use regulation to stimulate domestic demand for green technologies as is being done for electric vehicles, the CBI added.
Last year, the UK closed the grant scheme for electric cars, claiming that a “mature market” had already been created. Industry lobby heads said the decision...