IBEC has warned that the Irish economy could lose out on millions of euro of investment unless the Government backs green energy schemes.
With private sector funding in Northern Ireland forecast to swell by €730 million over the next five years under renewable energy projects, IBEC called on the Government to follow suit.
Dermot O'Kane, chairman of IBEC's renewable energy working group, said Irish companies keen to expand in this area were being forced to look abroad.
"The new scheme in Northern Ireland will benefit rural communities and consumers through increasing security of energy supply and reducing the exposure of business to the volatility of fossil fuel pricing," he said. "The Irish Government must introduce similar measures here at the earliest opportunity."
Under the Renewables Obligation in the North, licensed electricity suppliers must provide evidence that a specified quantity of electricity supplied to consumers was generated from renewable sources.
The obligation will be set at 2.5 per cent of electricity supplied in 2005/06 and will increase to 6.3 per cent by 2012/13.
IBEC warned Minister for Environment Noel Dempsey that unless green energy schemes were promoted companies would continue to concentrate on overseas investment.
Mr O'Kane said the economy could lose out on millions of euro.
"If Minister Dempsey does not introduce a renewables support scheme soon, the current trend for Republic of Ireland-based renewable development companies to focus their resources on markets outside the state will accelerate and major investment in renewable electricity generation will be lost," he said.
"This will be a significant loss to the country and it will be difficult to persuade companies to invest in the future, as their interests will be focused elsewhere."
PA