New engine regulations aimed to address costs and parity have been approved by the FIA World Motor Sport Council.

After gaining approval from all levels of Formula 1 governance, the cost of power units to customer teams will be reduced by €1 million Euros ($1.5 million AUD) next year with the supply price set to drop a further €3 million ($4.5 million) in 2018.

The FIA has also outlined that drivers will be restricted to three power units per season from 2018.

Parity has also been addressed by removing the token system from 2017 onwards.

The current process allows manufacturers to develop their power units during the season using a set amount of development tokens.

A move to improve the noise of engines by 2018 is also underway.

“The FIA is pleased to announce that, following extensive work done in conjunction with the four power unit manufacturers involved in the FIA Formula 1 World Championship, and with the support of the commercial rights holder, a global agreement on power units has been reached for the 2017-2020 period,” said an FIA statement.

“The agreement has been approved by all levels of the F1 governance structure, including the World Motor Sport Council.

“It will now be included as technical and sporting regulations for the 2017 and 2018 FIA Formula 1 world championship.

“The global agreement on power units covers four key areas relating to the cost and supply price, obligation to supply, performance convergence and the sound of the power units.”

Below is the full outline of the new FIA engine regulations

Cost

Agreement has been reached on a significant reduction in the price of power unit supply to customer teams and a reduction in cost to manufacturers over the coming years.

In 2017 the power unit price for customer teams will be reduced by €1m per season compared to 2016.

From 2018, the annual supply price will be reduced by a further €3m.

Cost reduction on power units will be driven by changes to the Sporting and Technical regulations in 2017 and 2018, with a progressive reduction of the number of power unit elements per driver per season.

Supply

Supply of power units to customer teams will be ensured, as the homologation procedure will include an “obligation to supply” that will be activated in the event of a team facing an absence of supply.

Performance of convergence 

The new agreement includes a package of measures aimed at achieving performance convergence.

The token system is to be removed from 2017

Additionally, constraints on power unit part weights, dimensions and materials, and on boost pressure will be introduced in 2017 and in 2018.

Sound

Manufacturers are currently conducting a promising research programme into further improving the sound of the current power units, with the aim of implementation by 2018 at the latest.