The Indian government is preparing to introduce changes that could significantly reshape the electric vehicle (EV) landscape in the country. Under proposed fuel-efficiency regulations, electric cars may no longer be treated as completely “zero-emission” vehicles. If implemented, this move would encourage automakers to focus on building long-range EVs that consume less electricity.

As per the proposal, manufacturers will be required to disclose the energy consumption of electric cars in kWh per 100 km. This electricity usage will then be converted into a petrol-equivalent figure (litres per 100 km), and emissions will be calculated accordingly. The aim is to ensure that EVs are not only emission-free at the tailpipe but also energy-efficient overall.

According to a report by The Economic Times, this step is designed to motivate companies to develop electric cars that travel longer distances while using less power. Although EVs do not emit smoke, they still depend on electricity—much of which in India is generated from fossil fuels.

Why Energy Efficiency Matters

Data shows that a large share of India’s electricity still comes from coal-based power plants. Up to January in the current financial year, around 1,056 billion units of electricity were generated from coal, compared to 137.5 billion units from solar and 94.8 billion units from wind energy. Since coal-based power contributes significantly to carbon emissions, reducing electricity consumption through more efficient EVs has become a key concern.

Impact on Carmakers and CAFE Rules

If the proposal is implemented, it would go against car manufacturers’ demand that EVs be treated as fully zero-emission vehicles under Corporate Average Fuel Efficiency (CAFE) norms. While CAFE regulations were originally aimed at reducing petrol and diesel usage, their focus has expanded to cutting overall CO₂ emissions.

Currently, automakers earn “super credits” for launching electric vehicles, which they can use to offset higher emissions from petrol and diesel models—even if EV sales volumes are low. The government believes this loophole weakens the intent of emission regulations, and the new framework aims to correct that.

Petrol and Diesel Cars Will Also Feel the Heat

Under the upcoming CAFE-3 norms, companies may face penalties for selling high-emission vehicles. However, manufacturers can offset these fines by earning or purchasing credits through EVs or hybrid vehicles. Under the proposal:

• EVs and range-extender hybrids may earn three super credits

• Petrol and diesel (ICE) vehicles may earn one credit

This structure is expected to push manufacturers to improve efficiency across all vehicle types.

Government’s Core Concern

The government fears that classifying EVs as entirely zero-emission could reduce investments in improving fuel efficiency for petrol and diesel cars. In 2025, EVs accounted for just 4% of India’s passenger vehicle sales. Even by 2030, this figure is expected to rise to only 13–15%, meaning 85–87% of vehicles sold will still run on petrol or diesel.

To address this, the proposal compares the energy content of 1 litre of petrol (about 35 megajoules) with electricity units (1 kWh = 3.6 megajoules). This method will help calculate total energy usage and determine whether manufacturers are meeting efficiency standards.