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All you wanted to know about CAFE regulations

Parvatha Vardhini C | Updated on June 17, 2019 Published on June 17, 2019

Vehicular pollution is occupying centre-stage again. While the government is looking to advance the 2030 deadline for Indian manufacturers to switch over to electric vehicles in segments such as bikes and three-wheelers, manufacturers are opposing it. Target cleaner air through stricter CAFE norms instead, say some voices in the industry.

What is it?

CAFE or Corporate Average Fuel Efficiency/Economy regulations are in force in many advanced as well as developing nations, including India. They aim at lowering fuel consumption (or improving fuel efficiency) of vehicles by lowering carbon dioxide (CO2) emissions, thus serving the twin purposes of reducing dependence on oil for fuel and controlling pollution.

Corporate Average refers to sales-volume weighted average for every auto manufacturer. The norms are applicable for petrol, diesel, LPG and CNG passenger vehicles. CAFE regulations in India came into force from April 1, 2017. Under this, average corporate CO2 emission must be less than 130 gm per km till 2022 and below 113 gm per km thereafter.

Why is it important?

Global automakers are betting big on India as vehicle penetration is still low here when compared to developed countries. At the same time, pollution caused by the ever-increasing number of vehicles on road is worsening the air quality in many cities. Upgrading to stricter fuel standards is one way to tackle air pollution. CAFE regulations assume importance in the light of their ability to reduce the carbon footprint of the auto industry.

The National Auto Policy (draft) put out in early 2018 calls for developing a roadmap for reduction in CO2 emissions through CAFE regulations. It calls for defining corporate average CO2 gm per km targets for all passenger vehicle manufacturers from 2020 and aspires to match Indian CO2 reduction targets to those set by developed countries by 2025.

The Auto Policy also contemplates economic penalties for manufacturers who do not meet corporate average targets and envisages a system where credits under the scheme (for achieving better than mandated fuel efficiency) can be banked and traded.

Stricter CAFE targets can also lead to manufacturers moving to electric or strong hybrid vehicles over the medium to long-term to comply with the norms.

Why should I care?

Recently, air quality issues across large Indian metros have grabbed the headlines with the courts and policymakers coming up with ad-hoc solutions to fix the issue. A permanent solution would be welcome. So, if you care about your health, curbing vehicular pollution is something that will help by enhancing your quality of life. Alongside the implementation of the BS VI emission norms from April 2020 onwards and the plan to shift to mass use of electric vehicles by 2030, the CAFE regulation is one of the steps taken by the government to help you breathe cleaner air.

While CAFE regulations focus on reducing CO2 emissions, BS VI focusses on other harmful exhaust from vehicles. The BS IV-compliant fuel currently in use has 50 parts per million (ppm) sulphur. But BS VI stipulates a low 10 ppm. Besides, under BS VI, particulate matter emission for diesel cars and nitrogen oxide levels are expected to be substantially lower than in BS IV.

A mass shift to electric vehicle use will also bring down air pollution substantially. To encourage manufacture and sale of electric vehicles, the government is already providing incentives under FAME (Faster Adoption and Manufacturing of Hybrid & Electric Vehicles) scheme.

The bottomline

When it comes to tackling pollution, the more measures the merrier.

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Published on June 17, 2019
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