CAFE-3 emission norms: BEE likely to rationalise technology credits

The Bureau of Energy Efficiency (BEE) is planning to rationalise the list of technologies that carmakers can classify as “fuel-saving” to claim “technology derogation credits” while calculating the average emission of carbon dioxide in a fleet of vehicles, Business Standard has learnt.

 

This will be under the upcoming norms on corporate average fuel efficiency-3 (CAFE-3).

 

Several fuel-saving technologies are now widely used in India’s passenger vehicles. These include idle start-stop systems in about 54 per cent of cars, regenerative braking in 47 per cent, tyre-pressure monitoring systems in 63 per cent, and six-speed or higher transmission in 59 per cent —and these will not qualify for credit in the proposed CAFE-3 norms, officials said.

 

CAFE norms require carmakers to limit the average carbon-dioxide emission of all passenger vehicles they sell in a year. Emission is measured in grams per km (gm/km). The proposed CAFE-3 norms, under discussion and expected to be notified soon, will be in force from FY28 to FY32.

 

Officials said that not only was the list of eligible technologies being rationalised, but the level of benefits too was proposed to be reduced.

 

While the September 2025 draft had proposed allowing a technology-derogation benefit of up to 9 gm/km, the final notification is expected to cap it at 6 gm/km, with each approved technology eligible for a benefit of 1 gm/km.

 

According to officials, the cap is being reduced because it ties in with international practice and the Indian automobile industry’s feedback. Moreover, there is no officially notified testing method to independently verify and demonstrate the exact emission benefits of each technology. The lower cap is intended to ensure that incentives remain focused on “genuinely innovative technologies”.

 

A list of 17 technologies is likely to be notified for benefits. These are fuel-saving features that are recognised in major global markets such as the United States, the European Union, China, and Japan, and are seen as delivering measurable gains.

 

The list is likely to include a 12V efficient alternator, which helps charge the battery more efficiently and reduces the load on the engine of the car. A 12V motor-generator system, also known as an integrated starter generator or belt starter generator, may also qualify. This system supports the engine during acceleration and helps save fuel, especially in city traffic.

 

Full-vehicle LED (light-emission diode) lighting is expected to be included because it uses less electricity than traditional bulbs do. Solar-reflective paint and advanced glazing, which is special heat-cut glass, may also be considered because it keeps the cabin cooler and reduces the need for air-conditioning.

 

Several engine and cooling-related technologies are likely to feature on the list of 17 technologies. These include an electric water pump, which circulates coolant more efficiently than a traditional belt-driven pump. A high-efficiency engine cooling fan and a PWM-controlled radiator (PWM is “pulse width modulation”) fan are also expected to be part of the list. PWM refers to electronic control that adjusts fan speed as needed instead of running at full power all the time.

 

A variable crankcase suction compressor and a high-efficiency air-conditioning system may qualify because they reduce the fuel consumed. An integrated heat exchanger, which improves the way heat is managed within the engine system, is also likely to feature on the list.

 

Other possible inclusions are a PWM-controlled blower motor, which regulates cabin airflow more precisely, and active cabin ventilation and active seat-ventilation systems, which improve cooling comfort while optimising power use. Active engine and transmission warm-up systems may qualify.

 

Intelligent alternator control, which manages when the battery is charged to reduce unnecessary engine load, is also expected to be on the list.

 

Officials added that these technologies were likely to be grouped into “low-cost”, “medium-cost”, and “high-cost” categories based on the additional cost per vehicle. This structure would help manufacturers decide which technologies to adopt, depending on their budget and compliance strategy. 

Cleaner credits 

• Common features like start-stop, regenerative braking to be excluded 
• Total credit cap may be reduced to 6 g/km from 9 g/km
• CAFE-3 to specify 17 globally proven techs eligible for credits
• Efficient alternators and electric water pumps likely to be included