It was not too long ago that a diesel-driven Jaguar was as unthinkable as Miley Cyrus swinging naked on a wrecking ball.

But since the current generation flagship XJ made its debut in 2010 with a 3-litre turbodiesel V6 variant, the concept is no longer foreign.

In fact, compared with its 5-litre V8 twin, the turbodiesel XJ is a more sensible choice because of its lower annual ownership cost.

But does a diesel variant of the XE junior executive sedan make as much sense? Yes, even if the cost advantage is not as big as what the diesel XJ offered.

The XE2.0D has the same engine displacement as the petrol-powered XE, so it attracts a significantly higher annual tax (diesel cars are levied a surcharge here). To be precise, the diesel car's tax is $2,012 a year, versus $1,051 a year for the petrol car.

But the diesel model is more fuel efficient. And because diesel is substantially cheaper at the pumps, the fuel bills of the two differ quite a bit. Going by the annual average mileage of 17,500km, the petrol car would require $2,625 worth of fuel a year, compared with $890 for the diesel.

So, the fuel savings of the 2.0D outweigh the additional tax the car attracts.

The diesel model is also less expensive to buy. It is priced $20,000 lower - partly because of the $10,000 carbon rebate it qualifies for and partly because Jaguar wants to make the XE more competitive against its rivals.

So should you go for the diesel XE instead of the petrol one? Well, like most things in life, it depends on your priorities.

The turbodiesel variant is powered by a new engine developed in-house. While there is no denying that the unit is dripping with torque, the car is not as refined or as breezy as its petrol twin.

Throttle response is stodgy and one often finds one's right foot exerting quite a lot of weight to get the car moving.

But when it does get moving, the acceleration is equivalent to what one experiences in the petrol version. The 0 to 100kmh sprint is accomplished in 7.8 seconds, merely 0.1 of a second longer than the petrol car.

You would imagine a car with 430Nm of torque at its disposal would literally be leaping from junction to junction, but the XE 2.0D just feels like it requires more effort to drive than its twin (which has 280Nm to its name).

You could explain this with an analogy of two water taps with identical sources - but one has a tighter faucet than the other.

The diesel XE is also more prone to cabin rattle. The noise level from the drivetrain is higher as well, especially when moving off or under hard acceleration.

These traits give the impression that the 2.0D is harsher and not as smooth as the petrol XE. The difference becomes less apparent when both cars are cruising comfortably at 90kmh.

Clearly, those who prize refinement and driveability above mere dollars and cents should go for the petrol Jag. Those who are less sensitive to a car's operating characteristics will no doubt find the turbodiesel the more logical and economical choice.