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ID: 118820

Dieselization in Sweden / Kageson, Per

Kageson, Per	Journal Article
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Publication

2013.

Summary/Abstract

In Sweden the market share of diesel cars grew from below 10 per cent in 2005 to 62 per cent in 2011 despite a closing gap between pump prices on diesel oil and gasoline, and diesel cars being less favored than ethanol and biogas cars in terms of tax cuts and other subsidies offered to "environment cars". The most important factor behind the dieselization was probably the market entrance of a number of low-consuming models. Towards the end of the period a growing number of diesel models were able to meet the 120 g CO2 threshold applicable to "environment cars" that cannot use ethanol or biogas. This helped such models increase their share of the diesel car market from zero to 41 per cent. Dieselization appears to have had only a minor effect on annual distances driven. The higher average annual mileage of diesel cars is probably to a large extent a result of a self-selection bias. However, the Swedish diesel car fleet is young, and the direct rebound effect stemming from a lower variable driving cost may show up more clearly as the fleet gets older based on the assumption that second owners are more fuel price sensitive than first owners.

Key Words

Rebound Effect ; Diesel Cars ; Dieselization

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ID: 118819

Taxation of diesel cars in Belgium – revisited / Mayeres, Inge; Proost, Stef

Proost, Stef	Journal Article
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Publication

2013.

Summary/Abstract

This paper compares the current taxation of diesel and gasoline cars in Belgium with the guidelines for optimal taxation. We find that diesel cars are still taxed much less than gasoline cars, resulting in a dominant market share for diesel cars in the car stock. If the fuel tax is the main instrument to control for externalities and generate revenues, the diesel excise should be much higher than the excise on gasoline for two reasons: diesel is more polluting than gasoline and more importantly, through the better fuel efficiency, diesel cars contribute less fiscal revenues per mile.

Key Words

Diesel Cars ; Optimal Taxation ; Environmental Externalities

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