Table of Contents
Context
The Ministry of Power has notified new Corporate Average Fuel Economy (CAFE) Norms for passenger vehicles, applicable from 1 April 2027 to 31 March 2032.
About CAFE Norms
- Nature: A regulatory standard that sets limits on the fleet-average fuel consumption and CO₂ emissions of new passenger vehicles sold by an automobile manufacturer.
- Organisation: Notified by the Ministry of Power under the Energy Conservation Act, 2001, with technical coordination from BEE and MoRTH.
- Aim: Reduce fuel consumption, crude oil dependence and transport emissions while promoting EVs, hybrids and cleaner fuels.
- Stricter Efficiency Targets: The fleet fuel-consumption limit will tighten from 3.996 litres/100 km in 2027–28 to 3.3273 litres/100 km by 2031–32, aiming at over 16% improvement in fuel efficiency.
- Weight-Based Targets: The reference vehicle weight will rise from 1,082 kg to 1,229 kg, with different efficiency requirements based on vehicle weight.
- Carbon Neutrality Factor (CNF): Credits the use of ethanol blends, biofuels and compressed biogas (CBG) in meeting compliance requirements.
- Super Credits: Provides additional compliance benefits for BEVs, plug-in hybrids, strong hybrids, flex-fuel vehicles and range-extended EVs.
- Fuel Conservation Credits: Recognises 12 energy-efficiency technologies, including reflective paints, advanced glazing and efficient air-conditioning, with concessions capped at 9.0 g CO₂/km.
- Credit Flexibility: Allows carry-forward of credits, inter-manufacturer credit trading and buyout of compliance requirements.
- Testing Standards: Requires reporting under both Modified Indian Driving Cycle (MIDC) and WLTP standards.
- Small Automaker Exemption: Manufacturers selling fewer than 1,000 vehicles annually are exempted from the norms.


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