If governments fail to reach agreement on tackling climate change, global industry should be able to remove 17bn tons of projected CO2e emissions by 2020 and stabilise the climate, Virgin chief Richard Branson has said at the UN climate talks in Cancún.

But he tempered his optimism that the world's entrepreneurs could slash emissions better than states by saying that governments had to set the framework for business to go green.

"The ideas are out there. But if the worst came to the worst and governments did not get their act together, industry should be able to solve the problems themselves. If governments set a framework in which clean energy was not taxed and dirty energy was, then there is a chance. That's what government has to do," he said.

Branson, in Cancún to launch a web-based initiative to reduce shipping emissions by as much as 25% over the next 20 years, said taxes could be useful. "[Carbon] taxes are fine if they are global. Everyone must be in the same boat. We would welcome it if they were done equitably, across the board and as long as it's not just airlines. Everyone must share the burden."

UN secretary general Ban Ki-moon's high-level finance committee, which includes Lord Nicholas Stern and energy secretary Chris Huhne, said last month that shipping and aviation taxes could raise $20bn to help poor countries adapt to climate change.

Branson said that Virgin planes could fly on biofuels within three to five years. "The biggest prize has to be clean fuel. We are investing 100% of our profits from aviation into fuel research. It looks like fuel derived from algae or isobutanal should be powering our aircraft. Both have got products going into test phases. We are perhaps three to five years away."

He said Virgin had considered slowing planes down to save fuel. "But it actually uses more fuel," he said.

"I was hoping by now we would be towing planes to the end of the runways. But we've found there was stress on the front of the plane. Boeing is now looking at battery power to drag planes along the ground from the front wheels.

He said that a combination of ideas such as retrofitting planes with winglets, rationalising air traffic control in Europe to reduce planes' waiting time to land and making planes lighter by using carbon fibre could reduce emissions significantly.

"The [Boeing] 787, to be launched next year, is 50% carbon fibre. It can save 15-20% on older planes. Winglets can save 12% of fuel," he said.

Carbon War Room, the non-profit business group co-founded by Branson, aims to find ways for business to reduce emissions in 17 industries by one billion tonnes of CO2 each. After shipping, the group intends to generate ideas and seed money to reduce emissions in the IT industry, as well as islands and aviation.

He said there were dozens of ideas to reduce shipping emissions, ranging from coating hulls in ultra-slippery paint, using satellite navigation to avoid storms, blowing bubbles under hulls to reduce friction and using sails.

Yesterday the group officially launched a website shippingefficiency.org which shows the carbon intensity of the world's 60,000 largest ships, allowing import and export companies to choose between sending goods in clean or dirty ships.

Branson also proposed that grant-making foundations risk money to support nascent clean energy. "They give away billions a year. If they took 20% and invested in, say, winglets for ships, they might lose it but that money could be greatly magnified and the foundation would get its money back. They would have given it away anyway," he said.