Biofuels will harm biodiversity and may even cause greenhouse gas emissions, an independent review has concluded.
The Renewable Fuels Agency's (RFA) Gallagher review into the indirect effects of biofuels said increasing demand is also contributing to rising food prices, which in the short term could have a severe impact on the poor.
But the RFA ruled out a moratorium on biofuels, and instead called on Government to reduce the rate of increase of the UK's biofuels target to just 0.5% a year, bringing the target to 5% in 2013-14.
The Renewable Transport Fuels Obligation (RTFO), which came into force in April, requires 2.5% of fuel on forecourts in 2008-09 to be biofuels, increasing by 1.25% a year to 5% in 2010-11.
The review also said the EU's target of 10% biofuels by 2020 is not justified by scientific evidence but could be possible if conditions are put in place to ensure sustainability.
Professor Gallagher said: "Our review makes clear that the risks of negative impacts from biofuels are real and significant, but it also lays out a path for a truly sustainable biofuels industry in the future."
Responding to the review, Government announced it will consult on slowing down the rate of increase in the RTFO and will press for the EU's 10% target to be kept under regular review.
Environment Secretary Hilary Benn said: "We need to proceed more cautiously than previously thought, but we should not give up on the potential for some biofuels to help us tackle climate change now and in the future."
Greenpeace chief scientist Dr. Doug Parr said: "This review sends a stark message - using food crops to fuel our cars risks making climate change worse and increasing food prices for the world's poorest people."
He called on Gordon Brown to promote other green motoring alternatives, such as making our cars more fuel efficient and boosting the number of vehicles powered by clean, renewable electricity.
Alwyn Hughes, chief executive of Ensus, which is building Europe's largest biorefinery in North East England, said: "We are very concerned at the suggestion of backtracking on existing commitments under the RTFO.
"We think this is unnecessary when sustainable production can already be achieved."
Earlier this week, the Environment Committee of the European Parliament voted to reduce the proposed 10% target to 4% by 2015, followed by a major review.
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