BEE's February move to tighten CAFE-3 technology credits ahead of FY28 rollout resurfaces
India's Bureau of Energy Efficiency was reported in mid-February 2026 to be capping CAFE-3 technology-derogation credits at 6 gm/km, versus 9 gm/km in the September 2025 draft. Common features including idle start-stop and regenerative braking may be excluded, raising compliance pressure on carmakers from FY28 to FY32.
What happened
Bureau of Energy Efficiency (BEE) · BEE is expected to tighten CAFE-3 technology credits for Indian carmakers, excluding common features such as start-stop and
Key facts
- CAFE-3 norms to apply from FY28 to FY32
- Technology-derogation credit cap expected at 6 gm/km, down from 9 gm/km proposed in September 2025 draft
- Each approved technology expected to receive 1 gm/km credit
- 17 technologies likely to be eligible
- Idle start-stop used in about 54% of cars
What changed
BEE is expected to tighten CAFE-3 technology credits for Indian carmakers, excluding common features such as start-stop and regenerative braking. The proposed 6 gm/km cap and 17 eligible technologies could reshape vehicle feature adoption and compliance costs from FY28.
Why this matters
Automakers should accelerate fuel-efficiency roadmaps and reassess model-level compliance plans as tighter CAFE-3 credits could raise FY28–FY32 fleet-average emissions pressure.
What to watch
- Final BEE notification confirming a 6 gm/km technology-credit cap and the definitive list of eligible technologies.
- Clarification of FY28-FY32 fleet-average targets, penalties, super-credits, credit banking and carry-forward rules.
- OEM disclosures of CAFE compliance gaps, planned hybrid launches, ICE-engine upgrades and capital-expenditure revisions.
- Price hikes or discontinuations in mass-market ICE nameplates during FY27 model-year planning.
- Supplier order wins for hybrid components, battery packs, lightweight materials and efficiency-focused thermal-management systems.