BRUSSELS - European environmental ministers have delayed until October a decision on whether to accept an industry proposal to drastically lower carbon dioxide emissions.
The European Commission cannot act until the Council of Ministers and European Parliament agree on how much cleaner fuel should be. They have been deadlocked for months, but the two sides appear ready to compromise on sulfur content in fuels.
The Parliament wants sulfur cut to 50 parts per million for diesel and 30ppm for gasoline. Commission sources said the Council will now accept 50ppm for both diesel and gasoline, though initially it proposed 350ppm for diesel and 200ppm for gasoline.
Carmakers want sulfur levels cut to 30ppm. They say petroleum companies must clean their fuels to that level before they agree to voluntarily improve fuel economy.
But an industry source said that ACEA, the European automakers' association, would probably accept 50ppm.
European gasoline typically contains more than 400ppm of sulfur. Diesel fuel has up to 500ppm.
The fuels issue has been the major roadblock to an agreement that would dramatically reduce CO2 emissions by 2008.
The European Commission has accepted ACEA's proposal to reduce the average CO2 output from vehicles produced by its members to 140 grams per kilometer by 2008, a reduction of 25 percent.
At that level, fuel economy would be about 6.0 liters per 100km for gasoline engines and 5.3 liters for diesels.
But ACEA's offer includes a provision for cleaner fuels, which carmakers say is needed to make use of new technology like catalytic converters for lean-burn engines.
'It's clear that our battle is still on fuels,' said Camille Blum, secretary general of ACEA. 'Our position is to maintain the pressure until the very end.'
The European Commission wants automakers to voluntarily reduce CO2 emissions rather than face legislation.
The automakers' proposal would not require individual carmaker to achieve a corporate average fuel economy, as in the USA. Fuel consumption for each of the 12 ACEA members would be averaged together.
Importers and the Japanese transplants would have to negotiate separate and similar agreements with the European Commission.