Business Secretary Vince Cable has warned green taxes on energy, which hits energy-intensive industries, are undermining businesses in Britain.
He said levies such as the carbon price floor are hampering businesses due to the high costs, which are not faced by international competitors.
Speaking at the Lib Dem party conference in Glasgow, he added British firms are “struggling” to compete with their international rivals on price, which is leading to work going abroad.
Mr Cable said: “Many of our manufacturing companies and exporters – particularly in areas like steel and cement and others which consume lots of electricity – are struggling against international competition because of the cost of energy.
“They will argue that because we are trying to be green we are imposing costs on them which their competitors don’t have.
“Now of course a lot of that is unfair and we have now introduced compensation schemes to offset some of those costs, but … it doesn’t go the whole hog by any means.”