But fuel crops also hold the potential for considerable environmental harm. Not only is native vegetation, including tropical rain forest, being chopped down in some cases to plant the crops, but the crops also are often grown using fossil fuels like diesel for tractors  and they demand nitrogen fertilizer made largely with natural gas. Moreover, turning the crops into fuels can demand huge amounts of water.

Experts say certain types of fuels, particularly those made from agricultural wastes, still hold potential to improve the environment. But it is only now becoming clear that to achieve that goal, governments will have to set and enforce standards for how the fuels are produced.

With its new proposal, Europe appears to be moving ahead of the rest of the world in that task. In part, that is because biofuels are the main weapon foreseen by the European Union to lower emissions from the transportation sector, which has the fastest growing levels of greenhouse gases among all sectors of its economy.

The increasingly negative image of biofuels has left officials pulled in separate directions  on the one hand trying to clean up the European market for biofuels that cause environmental damage, while on the other hand seeking to rehabilitate biofuels to meet Europe’s ambitious greenhouse gas emissions targets.

The draft rules by the European Union would probably have the biggest effect on growers of palm oil in countries like Malaysia and Indonesia, according to Matt Drinkwater, a biofuels analyst with New Energy Finance in London.

“Some proposed developments in Southeast Asia will almost certainly be blocked by these provisions,” he said, explaining that the rules would make it much harder to plant on recently cleared land or export fuels to Europe that emit significant amounts of greenhouse gases produced during the process of manufacturing biodiesel from palm oil.

Growers of crops to produce ethanol  a substitute for gasoline that is more commonly used in the United States than in Europe  also could be affected because the proposed European Union rules include provisions on preserving grasslands, Mr. Drinkwater said. Crops for ethanol are grown widely in parts of South America, including Brazil.