Prime Minister Malcolm Turnbull won't sign an international agreement to phase out fossil fuel subsidies amid concerns it could jeopardise Australia's diesel fuel rebates.
Mr Turnbull has opted out of signing the key fossil fuel subsidy reform communique at major United Nations climate talks in Paris, a government spokeswoman confirmed.
The call to phase out the subsidies is being labelled the "missing piece of the climate change puzzle" and is led by New Zealand Prime Minister John Key.
More than 30 countries and hundreds of businesses have signed the communique calling for the ultimate elimination of fossil fuel subsidies, saying the cost should reflect both environmental costs and supply costs.
"The majority of fossil-fuel subsidies are also socially regressive, with benefits disproportionately skewed toward middle-and upper-middle income households," the communique states.
A partial phase out could generate 12 per cent of the emissions reduction needed by 2020 to be on the path towards limiting global warming to two degrees, it says.
However, Mr Turnbull won't bow to international pressure and join the call on Monday with MPs back home concerned the agreement could harm diesel subsidies claimed by farmers and miners.
National's MP George Christensen took to Twitter to vent his anger, saying the end of the rebate would cost jobs.
"To sign this is madness. It will cost jobs & give greens ammo to attack coal further," he tweeted.
The Australian Conservation Foundation labelled the communique an early test for Australia at the UN climate change conference.
"The diesel rebate is notorious because it means while Australian motorists pay 38 cents in tax on every litre of fuel they buy, some of the world's biggest mining companies pay not a single cent in tax for the diesel they use in their mining operations," foundation economist Matthew Rose said.
But National's MP Barnaby Joyce maintains the diesel fuel rebate is not a subsidy.
"Farmers and miners don't use public roads, so why should they pay a public road tax?" he told the Australian newspaper.
The G20 and the Asia Pacific Economic Cooperation group agreed to phase out inefficient fuel subsidies in 2009.
Earlier this month, the OECD signed an agreement to restrict export credits for inefficient coal power plants overseas to encourage the use of cleaner technology.
Mr Turnbull is in Paris for the climate talks, where it's hoped 196 parties will sign a historic agreement to curb emissions and limit global warming to at least two degrees.
Australia will commit to doubling investment in renewable energy as part of Mission Innovation, an initiative involving 20 countries including the United States.
The 20 countries represent 80 per cent of global clean energy research and development budgets.
As part of the plan, Australian government investment in clean energy research and development will double to about $200 million by 2020.