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Since George W. Bush pledged a major US effort to develop biofuels in his State of the Union address earlier this year, it seems the whole world has joined the rush to convert corn, sugar, cassava, sorghum and palm oil – not to mention cooking fat and farm waste – into the fuels of the future.

From China and Indonesia to India and Cuba, everyone wants to turn crops into energy. The European Union is even considering a mandatory 10 per cent biofuel content at every pump. The dream is to cut reliance on fossil fuels while also reducing net greenhouse gas emissions and even helping hard-pressed farmers. And yet, there is a downside to all this.

With today’s biofuel technologies, filling fuel tanks this way would require a huge amount of land – enough to transform the world’s agriculture (see Fuels gold: Big risks of the biofuel revolution). The prospect of growing corn to make ethanol is already helping to push up global grain prices and reduce emergency food stocks. Areas earmarked for palm oil biodiesel production in south-east Asia threaten to finish off the region’s surviving rainforests.

What’s more, a rash of studies suggests that the greenhouse gains from biofuels are far less than commonly assumed. True, the carbon emitted by burning biofuels is absorbed by the next crop as it grows, but manufacturing the fertilisers and pesticides needed to grow most biofuels requires large amounts of energy, as does turning the product into fuel. The net emissions reductions compared with conventional fossil fuels are often small – little more than 10 per cent in the case of corn, Bush’s biofuel of choice.

Does this mean that biofuels are a wasted cause? Certainly not. The good news is that the technology is only just getting started. The trick will be to find ways to use plants that grow well without a sea of chemicals, and to process them more efficiently. We shouldn’t dismiss all biofuel projects until each new technology is up and running. Modest use of biofuels today is perfectly acceptable and passably green – for instance, there are few downsides to converting used cooking oil into biodiesel, recycling farm waste or growing biofuels on disused land.

The key here is caution. Research into advanced biofuels has been starved of funds for decades. It is at a very early stage and may one day deliver, so we must give it time to mature. Meanwhile, we cannot grow our way out of the twin crises of climate change and energy security. There is a real danger of creating a biofuels bubble that will burst, leaving behind a pungent whiff of chip-fat oil, burning rainforests and rotting fields.