Volkswagen Canada: If you drive less than 25km /day you should not drive diesel.
http://www.theglobeandmail.com/globe...rticle4099688/
But again short distance is also bad for gas powered hence hybrid or electric is better.
The idea is consumer choice more the better, the market will decide.
Another viewpoint is occupant safety in a crash. Generally, a larger vehicle is preferred. As the streets are clogged with more vehicles one would expect more accidents.