The fines can go up to thousands of crore rupees for large volumes. The clause in the wider Energy Conservation (Amendment) Bill 2022 states that a business, if found to be in breach of fleet emissions scores, will face a fine of Rs 25,000 per car sold.
The bill, which was approved by Parliament on Monday, empowers the government to mandate the use of non-fossil fuels by industries, set efficiency standards for vehiclesvessels and equipment, as well as creating an internal market for carbon emissions trading to accelerate the green transition.
While the average corporate CO2 limit for Indian automakers has been set at 113gm per km, each company will have their own individual caps based on the number of cars sold and mix of fuel types – petrol, diesel, hybrid , methane or electric. The Rs 25,000 fine will come into effect if the fleet CO2 emissions for a company are 0-4.7% higher.
If the fleet’s CO2 emissions are above 4.7 gm, the penalty will be Rs 50,000 per unit sold. Industry observers said fines set in India are “much higher” than those in other geographies and will come as a setback for companies, which have been working to add sustainability to the fleet.
“In the case of companies selling in volume, the fine can go up to thousands of crore rupees, even if the CO2 emissions are slightly above the limit. This is unfair as companies are investing in green technologies such as hybrid, electric and CNG, on top of what they have spent migrating to BS6 standards,” an official said.