The European Commission is to propose a draft law next week banning certain biofuels from being imported into the EU.
According to reports in the New York Times, the proposed legislation would ban importing of biofuels from crops grown on certain kinds of environmentally sensitive land, including forests, wetlands or grasslands.
The law would also demand that biofuels used within Europe demonstrate that they deliver "a minimum level of greenhouse gas savings", although the exact level is still under discussion.
The move would primarily impact biofuels from palm oil plantations in South East Asia, which have been widely condemned by environmentalists for contributing to clearance of tropical rainforests.
The EU last year set a target to ensure 10 per cent of transport fuels come from biofuels by 2020, but the policy has been criticised by a raft of studies that have argued that the boom in demand for biofuels has largely failed to deliver promised carbon savings and contributed to increased food prices.
The proposed legislation comes just days after The Royal Society released a study arguing that biofuels did not represent "a silver bullet" for tackling transport's carbon emissions.
The report urged the UK government to impose a target for cutting carbon emissions alongside its target for biofuel use in order to ensure only biofuels that deliver significant carbon savings are used.
"Biofuels could play an important role in cutting greenhouse gas emissions from transport here and globally," said Professor John Pickett, who chaired the Royal Society study. "[But] in designing policies and incentives to encourage investment in and the use of biofuels, it is important to remember that one is not the same as another."
Speaking earlier this week in an interview with the BBC, European Commission environment minister Stavros Dimas admitted that Europe may have to reconsider its biofuel policy. "We have seen that the environmental problems caused by biofuels are bigger than we thought they were," he said.
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