European Union renewable energy targets may have increased greenhouse gas emissions because the dirtiest biofuels produce three times the emissions of diesel oil, according to the most complete EU analysis yet carried out.

Biodiesel made from palm oil emits more than three times as much and soybean oil around twice as much, when the crops’ effects on land use are considered, the research by the Ecofys consultancy for the European commission found.

Europe’s aim of sourcing 10% of its transport fuel to “renewables” by 2020 – mostly biodiesel - will foster crop cultivation on 6.7m hectares of forests and grasslands, the paper says. When the loss of trees is factored in, such ‘first generation biofuels’ would generate around nearly 1bn tones of CO2 equivalent.

“We need to rapidly accelerate the phase-out of first generation biofuels,” said Jos Dings, director of the green thinktank Transport and Environment (T&E). “Biodiesel is a big elephant in the room. It accounts for three quarters of the biofuel we use in the EU and this report pinpoints that its emissions are much worse than fossil fuels.”

The study says that an EU decision to cap the contribution that first generation biofuels can make to the transport target at 7% will save more than 500m tonnes of CO2 – around the same amount that Europe’s cars emit each year.

But T&E still estimates that, far from slowing climate change, the EU’s transport goals could add approximately 2 gigatonnes of greenhouse gases to the atmosphere. On an annual basis, that would account for around 2-3% of the continent’s total carbon output.

“It is just astonishing,” Dings said.

The report’s publication was delayed for several months and its release online last week – it has since been taken down – followed an access to documents request by T&E.

“It was finished ages ago but DG Ener [the commission’s energy wing] never wanted to publish it,” one EU source told the Guardian.

Internally, it was argued that the study’s publication could damage international relations with palm oil-producing states. But the official said it was “obvious” that the paper was sat on because its results were inconvenient.

The report examines the effect of land use change on biofuel emissions. Felling a forest for a palm oil plantation has clear consequences for increasing emissions. But when existing cropland is used for more profitable energy crops, the indirect effect can be similar; new land is carved out of forests or grasslands to grow replacement food staples.

For every megajoule of energy used, the study finds that palm oil emits 231g of CO2 equivalent and soybean oil 150g/CO2e, far higher than the UN climate science panel’s estimates for any fossil fuel.

Past commission estimates pegging palm oil’s CO2 emissions at less than half that figure were criticised by industry for being exaggerated. But it now seems that they significantly under-estimated biodiesel’s climate impact by not counting carbon emissions from peatlands drained to make way for oil plantations, experts say.

“Because of the link to deforestation, peat loss to create biofuels is not just worse than fossil fuel diesels, but potentially a lot worse,” said Chris Malins, the head of the ICCT fuels programme, and an adviser on the report. “There is no case for continuing to support virgin vegetable oil-based biodiesel on climate grounds.”

Malins said that paper found that ethanol could still deliver emissions savings but had significant indirect effects on emissions, albeit “less fatal” than biodiesel’s.

However, Robert Wright, the secretary general of the ethanol industry association ePURE said the study showed that ethanol had low land use impacts, strongly contributed to reducing greenhouse gas emissions and had little effect on food prices.

“We urge European policy-makers to reflect on these findings and identify ways to promote and incentivise the use of biofuels that have high greenhouse gas savings and low land use change impacts, such as European ethanol,” he said.

Dings, an influential figure among Brussels policy-makers, said that while his organisation did not support ethanol, their priority was to push for a phase out of biodiesel.

The European Biodiesel Board was not able to comment on this story at the time of writing.