NEW DELHI: Power and road transport ministries have been asked for clarity on recovery of penalties imposed on carmakers for failing to meet the Corporate Average Fuel Efficiency (CAFE) norms.
CAFE, a mandatory regulatory standard, sets limits on average CO2 emissions or fuel consumption for the entire fleet of vehicles sold by a carmaker.It’s learnt that the PMO has asked the stakeholder ministries to address the issue considering that the next phase of CAFE (CAFE 3.0) will have stricter norms for compliance.On March 17, TOI had reported that going by the presentation made by power ministry to PMO, out of the top five carmakers (80% market share), only Tata Motors would be able to meet the target for all five years – FY28 to FY32.
Officials had also said that the proposed regime would end up levying high penalty in case of non-compliance.“In such a condition, the responsibility of evaluation, approval and recovery of penalty must be defined properly. The PMO’s concern is valid considering that there has been no recovery of penalty from companies that didn’t meet CAFE 2.0 requirements,” said an official.Around Rs 8,800 crore of penalties have been levied on 10 major carmakers for failing to meet CAFE 2.0 targets up to FY23. Officials said that while Bureau of Energy Efficiency has carried out the calculation of penalty for each carmaker, they can be recovered by the adjudicating officer under State Electricity Regulatory Commission, as per the Energy Conservation Act, 2001.A person familiar with the developments said, “Ideally, the ministry or department which enforces an Act, frames norms for assessment and makes the penalty formula should implement the task of recovering the penalty.”
