Virgin Atlantic are among airlines to trial flight powered by biofuel
Biofuel research should focus on planes and not cars, the think tank Policy Exchange has said.
A crop area the size of the USA would be needed to biofuel all the world's cars and alternatives, such as electricity, exist for them, it added.
Instead, it said the EU should fund research into using plant-based fuel for aviation to help cut emissions.
Sceptics say some biofuels create more carbon than they save and push up the price of food for the poor.
Most biofuels are derived from crops such as corn, sugarcane and rapeseed.
Bioethanol is usually mixed with petrol, while biodiesel is either used on its own or in a mixture.
The UK government, which is funding a £27m research centre to find economically viable alternatives to fossil fuels, says 25% of greenhouse gas emissions come from transport.
In April 2008, it introduced a "Renewable Transport Fuel Obligation", requiring 2.5% of all fuel sold at petrol stations to be biofuels, having revised its target from 5%.
The EU also changed its stipulation that 10% of transport fuel had to be from crop-based fuel, instead saying the targets could be met by any renewable source, including fuel cells, hydrogen or solar power.
Policy Exchange has previously said the government should spend its £550m annual biofuel subsidies on halting the destruction of rainforests and peatland, which remove carbon dioxide from the atmosphere.
Now the centre-right think tank says the EU should switch policy to subsidising development of biofuels for aviation because planes cannot run on other sources of energy.
Airlines including Virgin Atlantic have trialled flights using up to 20% biofuel to power the engines, although climate change campaigners say use of the fuel is not sustainable.
Policy Exchange claims using biofuels is the only way in the foreseeable future to meet people's desire to travel without escalating emissions of greenhouse gases.
Airlines should be mandated to blend biofuel with kerosene in increasing quantities from 2020, it believes.
By this time new generation crop-based fuels should have been developed which do not compete with food crops.
Green groups have been critical of the destruction of rainforest to create the fuels and the resultant loss of habitat for rare species.
They also say that with more farmland being turned over to grow profitable biofuels, food production has fallen and pushed up global prices, affecting supplies for the poorest people.
Richard Dyer, Friends of the Earth's transport campaigner, said the report was right that it was important to cut flights "if we are to stand a chance of preventing catastrophic climate change".
"But replacing aviation fuel with biofuels will take us further down a blind alley as these so-called green fuels are already increasing the climate-changing emissions that our cars, buses and lorries are producing," he said.
"Growing crops for fuel is driving deforestation on a massive scale - when the full impact of this is taken into account, the biofuels added to our petrol and diesel may be producing more than twice the carbon dioxide of the fossil fuels they replace.
"New fuels for planes must be proven to cut overall emissions before Governments commit to targets for them. In the meantime Ministers must scrap plans to expand the UK's airports."