Scientists have this week predicted that a second generation of biofuels, including more efficient fuels made from fruit, wood and even human sewage, could be available within the next few years, potentially putting an end to fears that demand for biofuel made from crops such as palm oil is leading to tropical deforestation and driving up food prices.

However, environmentalists remain concerned that UK government targets to ensure biofuels make up 5 percent of all car fuel by 2010 could have disastrous environmental effects and that proposals unveiled today to ensure that biofuels come from sustainable sources are not stringent enough.

Writing in Nature, scientists from the University of Wisconsin-Madison reported that they had found a way to turn sugar from fruits such as apples and oranges into a powerful biofuel with many advantages over existing ethanol-based biofuels.

They claim that fructose can be converted into a fuel called dimethylfuran that can store 40 percent more energy than ethanol and is less volatile. The report claimed more work needed to be done to assess the fuel's environmental impact, but raised the prospect of a more environmentally sustainable generation of fructose based fuels.

Meanwhile, a new UK report from the Non-Food Crops Centre today outlined how fuel made from waste products, such as wood, plastic bags, straw and even human sewage could meet a third of the UK's motoring fuel needs.

The study claimed that production facilities where the waste is burned in low oxygen conditions and then chemically converted into diesel could provide a low carbon fuel source that would cost as little as 35p a litre.

The emergence of these so-called second generation biofuels would defuse current environmental fears that demand for ethanol-based fuels is leading to deforestation of tropical rainforest and contributing to food shortages as farmers in the developing world convert land used to grow food crops into biofuel plantations.

However, with such fuels still several years away from commercial scale production concerns remain that increased demand for biofuels could do more harm than good.

The government moved to allay such fears today with the publication of a package of proposals designed to ensure biofuels sold on UK forecourts come from environmentally sustainable sources.

Under the new Renewable Transport Fuel Obligation (RTFO) five percent of all the fuel sold on UK forecourts should come from biofuels by 2010, however now the government has released a consultation document proposing that from 2011 it will only certify biofuels if they meet sustainability standards and deliver quantifiable reductions in carbon emissions.

It also said it would investigate developing a voluntary labelling scheme that would allow retailers to reassure customers that their biofuel was environmentally sustainable.

Transport Secretary Douglas Alexander said the proposals underlined the government's commitment to ensuring biofuels genuinely deliver environmental benefits. "We are one of the first countries to develop a detailed methodology to allow transport fuel suppliers to report in detail on the carbon and sustainability impacts of their biofuels," he said.

However, several of the proposals will only place voluntary obligations on fuel suppliers while the suggested targets require that just half of biofuel feedstocks should meet a qualifying sustainability standard by 2010, rising to 80% by 2011, prompting criticism from leading environmentalists.

Ed Matthew, biofuels campaigner for Friends of the Earth argued that the proposals were further evidence that the government's biofuels policy has not been properly thought through. "It appears to be the Governments view that saving the world from disastrous climate change should be voluntary," he said. "They are not introducing mandatory standards, or setting a minimum threshold for the carbon savings to be made through the use of biofuels. Despite the fact that unsustainable bio-fuel production can lead to the destruction of rainforest and human rights abuses, suppliers won’t even be required to report where their bio fuel comes from."