France to Hike Diesel Tax

France to Hike Diesel TaxFrance to Hike Diesel Tax

France's long love affair with diesel is set to draw to a close, after the government announced a rise in the price of the fuel just weeks ahead of a major climate conference in Paris.

The country's environment minister also said that energy giant Engie, which is partly state-owned, was going to stop investing in the development of coal-fired power plants, the biggest source of manmade emissions, AFP reported.

The government will increase taxes on diesel over the next few years and at the same time reduce those on gasoline, with the aim of bringing the price of both fuels to roughly the same level.

A huge number of cars in France run on diesel, which is taxed at some 20 cents cheaper per liter than gasoline and represents around 80% of fuel volumes sold in the country.

This has led to more and more cars running on diesel "which has triggered legitimate concerns among many French people about the impact on air quality", the government said.

The car industry argues that diesel spews out less heat-trapping carbon dioxide than gasoline, but without sophisticated controls, the fuel may also emit harmful levels of poisonous nitrogen oxides and lung-clogging particles.

Revelations that Volkswagen equipped 11 million of its diesel cars worldwide with software that can switch off those pollution controls, except when it detects it is undergoing official testing, have sharpened the focus on diesel's risks.

In its statement, the government said it would double the subsidy to $1,140 given to owners of old diesel vehicles who change their cars. The measures come ahead of the UN's November 30-December 11 climate change conference in Paris, which aims to secure a pact on greenhouse gases that would limit global warming to 2 degrees Celsius above preindustrial times.