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Over the years, the rising GDP growth has been coupled with rising energy demand, particularly by the industrial sector of the country. The country’s biggest export industry – the RMG sector has been a major energy consumer and is projected to continue to be so. While domestic consumption has been rising steadily too, industrial consumption making up 19% of total natural gas consumption (which itself makes up for the highest share among all other energy sources, of total commercial energy at 46%)[1] has been rising with the increasing export of RMG over the years.
However, given the mounting demand, the, while rising, still lags far behind the market, particularly with severe seasonal impact. This crisis has had a pronounced effect on the production capacity of the apparel industry. Focus on alternative renewable sources of energy such as solar and biothermal energy has been growing, yet the capacity is far below the required level needed to effectively meet industrial demand, threatening to ruin the competitiveness of the country.
Bangladesh’s apparel sector now faces new global competition in terms of nearshoring and EU measures on sustainability. It is essential to look for ways to produce efficiently that require low energy (thereby saving production costs) and ensure the industry stays afloat once the measures are implemented in phases.
The European Union committed to becoming climate neutral by 2050, a goal outlined under the European climate law. This requires EU countries to reduce greenhouse gas emissions by at least 55% by 2030 compared to their 1990 levels. Under this goal, several climate regulations are expected to come into effect under the broad umbrella of CSRD – Corporate Sustainability Reporting Directive.
This requires companies to report on their ESG – Environmental, Social, and Governance practices across the value chain, thus ultimately affecting the apparel sector and the sourcing industry-based countries. Beyond reporting, the laws also encompass minimum criteria for product circularity, energy footprint, and carbon footprint reduction, possibly through a ‘Digital Product Passport’ detailing all the information under ESPR – Ecodesign for Sustainable Products Regulations which are likely to be stringently applied starting from 2024 under multiple phases.
Historically, the apparel sector in Bangladesh has been majorly pivoted by the forces of international buyers, resulting in significant improvement in compliance and worker safety as per buyer requirements. Similarly, the upcoming due diligence requirement has already instigated RMG manufacturers in the country to take up green practices, evidenced by the increasing number of LEED-certified factories resulting in the country reaching the apex position in the number of factories with LEED certifications. However, other than building design, the focus must also be to reduce energy consumption throughout the production value chain.
Apparel production starting from fiber to the final product is highly energy intensive. Thus, in Bangladesh, with over 5400 factories listed by BGMEA, the energy demand itself is remarkably high. Depending on the size of the factory, the textile industry’s energy demand shifts. Below is a breakdown of the factory and the number of workers.
As per CPD estimation of RMG factories in 2022[2]
A recent study shows that the current electricity demand in the RMG sector is over 6,000 Gigawatt hours annually, which roughly equals 8% of the country’s total consumption and 7% of the total electricity generated. Net Metering System is also being popularized with around 8,000 KW of solar capacity installed in RMG factories currently.
Energy intensiveness is not equally distributed across the entire value chain of the apparel production process. A study on an RMG factory in Bangladesh found that while dyeing is the most energy-intensive process, pre-treatment and sewing are consecutively second and third in energy in daily energy requirement.[3] Total electricity consumption in the fabric production process is estimated to be around 27,634 kWh and for garment production, it is estimated to be at 8,630 kWh. The same study estimates the amount of energy consumed for one piece of t-shirt is around 10 MJ.
Looking at thermal energy consumption, which is primarily natural gas consumption, we see a similar pattern too, with Dyeing being the most intensive followed by yarn production and the pre-treatment process.
Natural gas is used not only for electricity generation but also to generate steam for boilers, alongside direct consumption by boiler machines and other machines.
Beyond acquiescing compliance, energy-efficient measures allow for cost reduction as electricity and fuel costs across the globe see a rise. The seasonal variation of power availability impacts production (particularly for smaller manufacturers) and affects lead time due to power uncertainty. As a result, multiple factories in Bangladesh have already begun experimenting with innovative and cost-effective green practices.
Various studies in Bangladesh factories Research also suggest multiple simple ways that can help to reduce dependence on power. For example, a study found that by only regular maintenance of generators, 1.020 million/Nm3 gas consumption and 2.19 KtCO2 GHG emission reduction can be achieved. Daylight harvesting for factory floors can help to reduce nearly 20% of the lighting load. [4]
A large volume of hot water is needed in the dyeing sector resulting in high energy and water consumption. Improving energy efficiency in the dyeing process can be done through multiple ways such as using better and available technologies that can help reduce energy requirement by 25-50%, using solar energy for thermal processes, using waterless dyeing technology, reusing water, etc.
Within the production process, waste management system, energy reduction system, water consumption reduction, sound pollution reduction, green energy practice, lowered toxicity of chemicals, and usage of sustainable, recycled/reused raw materials in yarn offer ample scopes towards decarbonization. Some of these practices have already been gaining traction.
A study on Another study on 30 enterprises with integrated green production processes, found that LED lighting, servo motors in machines, dryer exhaust, water flow meters, energy meter and steam flow meters, cogeneration boilers, and natural cooling pads are popular methods of energy saving.[5]
AR jeans factory in Ashulia for example uses rainwater harvesting for internal water usage in washrooms, daylight harvesting to lower LED light requirement, solar power plant, and CO2 sensors to regulate fresh air flow. Using similar approaches Remi Holdings Ltd, Nasa Hitech Style Ltd. Industry has cut consumption of energy by 13-26%. Karupannya Ltd in Rangpur utilized exemplary green infrastructure design that allows factory floor temperature to stay at 24 degrees Celsius naturally, leading to a 40% reduction in energy usage.
Solar energy is the most accessible and easy-to-implement technology to reduce cost and thus has been gaining massive traction among private organizations with growing support from the government too. Typically, there are two ways in which solar energy is used in factories – photovoltaic applications used mostly for lighting, and thermal systems for primarily water heating purposes.
It is also very common to see factories install effluent treatment plants, particularly with the Central Bank’s push to popularize green financing. The need for a greening production process has become a key survival tactic, particularly with a highly competitive domestic industry (causing price wars to become unsustainable forms of holding on to buyers) and a growingly competitive global industry (with newer and nearer manufacturing countries or even more technologically advanced production).
Moreover, with a sharp and significantly conscious change in consumer spending habits, adopting an energy-efficient process is of paramount importance to lock-in brands. Looking at what the energy-efficient countries have been doing to reduce energy dependence and GHG emissions, we see a plethora of strategies that if implemented in Bangladesh, can lead to lower uncertainty with upcoming due diligence requirements and consolidate the industry’s growth and position. We take a brief overview of some of these efficiency measures adopted by the three major competitors before we discuss which ones can be viable for Bangladesh’s apparel sector.
Vietnam
In Vietnam, industries rely on coal-powered energy sources primarily. As a result, although the apparel sector doesn’t make up a large portion of the GDP of Vietnam, it is however one of the major contributors to pollution. The government has taken significant steps to steer energy reliance away from non-renewables to renewables.
Sustainability Awareness Campaigns have been launched targeting water consumption, and improved management of wastewater along with 6,500 solar panel installations, which helped reduce 25% of the load from the national grid.[1] Additionally, Vietnam is also looking to incorporate biomass-based steam-powered energy generation for yarn production, fabric dyeing, pattern printing, drying, ironing, etc.[2]
Vietnam Textile and Apparel Association (VITAS) is working to secure investment for a sustainable development program. VITAS and the World Wildlife Fund previously partnered together to promote improved water quality, improved river basin governance, and sustainable energy use.[3]
Alongside this, the government also has multiple programs through collaborations with international organizations to improve access to financial aid, technology, and expertise to transition towards a greener textile sector. The Industrial Energy Efficiency Project (IEEP), backed by entities like the EU and UNIDO, focuses on enhancing energy management practices by supporting big companies along with Small and Medium-sized Enterprises (SMEs)) for greater energy performance, reduced carbon footprint, and enhanced productivity and competitiveness.[4]
India
A study reports that the textile sector in India sees a rise in energy consumption due to primarily two reasons – the rising reliance on automation and inefficient machinery usage.[5] The electricity cost makes up around 65% of the total energy, which can be reduced by 18% through the efficient use of transformers, cables, motors, and lighting systems. Spurred by timely government schemes, the apparel sector in India has been proactively pursuing energy-efficient improvements that can reduce the cost of production. In a textile steel mill, the wet processing operation consumes nearly 50% of the total energy.
The Apparel Export Promotion Council (AEPC) has partnered with consultancies to conduct energy consumption assessment audits on member factories. APEC also organizes regular training programs on the dissipation of knowledge regarding energy-efficient production.
Moreover, case studies on factories using advanced HVAC – Heating, Ventilation, and Air-conditioning systems, have shown a substantial emission reduction. Raymond Limited – one of the largest vertically integrated enterprises in India, optimized its dyeing process resulting in lower water and energy consumption.
Perhaps the most remarkable achievement has been the initiation and implementation of the Perform, Achieve, and Trade (PAT) scheme of the Bureau of Energy Efficiency in India, which specified targets for the major segments of the production chain for any textile enterprise consuming 3,000 Metric ton of oil equivalent energy in 2012.
For each of the designated consumers working in these segments, it was essential to reach the target level of reduction by 2014-15 for tradable environmental instruments. The designated consumers receive Energy Saving Certificates (ESCerts) if they surpass their specific energy consumption (SEC) reduction targets. These can be sold to other designated consumers who have not met their targets, providing a financial incentive for energy efficiency improvements.[6]
Energy Consumption Reduction Target Assigned for Different Segments of Textile Industry Under PAT Scheme in India
The scheme saw overachievement of targets by the different sub-segments which led to the government expanding the scheme further. Through a combination of implementation of energy-efficient technologies such as modernization of machinery and automation, process optimization, expansion of renewable sources like biomass and solar, waste heat recovery, cogeneration (using heat from electricity generation for thermal application in the plant), training and capacity building, the PAT scheme helped to ensure the designated enterprises managed to reach their targets. The current focus is to utilize data analytics and innovation to further research into the implementation of energy-efficient systems, extend the scheme to SMEs, and provide continued incentives that encourage further development.
China
Coal, electricity, heat, and petroleum products are the key contributors to China’s textile industry. Thermal power resulting from the burning of coal and coke is the primary source of energy for much of the industry, although direct consumption has greatly decreased. Automation in the last decade has led to greater usage of electricity.
The energy footprint of China’s textile industry increased from 41.1 Mt in 1991 to 99.6 Mt in 2015.[1] A study on China’s textile industry estimates that a 1% increase in technological progress, enterprise scale, labor productivity, dependence on foreign trade, and industrial electricity price will produce a 0.387%, 0.216%, 0.267%, 0.077%, 0.137% reduction consecutively in the energy intensity.[2]
As a global leader in textile and apparel production, China has been spearheading technological innovation in the textile and apparel sector. China’s government’s drive towards a greener textile industry has led to multiple projects and programs being implemented that address sustainability.
These include energy efficiency improvements through the modernization of equipment, implementation of updated technology such as VFD – Variable Frequency Drivers which control motor speeds, and process augmentation by lean manufacturing system implementation.
The focus is on renewable energy through integrating wind power, solar power, waste heat utilization, and biomass energy in the textile sector. The industry also implements zero liquid discharge to ensure no effluents are discharged into river water.
Innovative technologies such as waterless dyeing and enzymatic treatments have also been popularized. The Chinese government has also instituted national standards such as China Environmental Labeling and Cleaner Production Standards to safeguard from environmental damage. The government has also undertaken collaborative efforts with industry leaders to share knowledge.
Exemplary among the enterprises is Esquel. Esquel factories use automation to smoothen and speed up transportation within the floor, improve product quality, and customize machinery to boost production processes rather than as a substitute for manual labor. Workers use robotic arms, machine vision technology, and self-developed automation technology to check for product quality consistency and eliminate repetitive physical work strains.
However, in their spinning mill, they have cut down on the required number of workers through automation and technological upgrading. In total, Esquel filed for 1300 patents till 2017 and currently holds over 100 patents in machine adaptations and material handling.
Esquel has also successfully reduced water consumption by over 60% within the last decade. The group is working on reducing the energy consumption in the dyeing segment through collaborative research.[3]
Overall, the strategies of the competing countries point to the necessity of synergy of approach between government, industry leaders, facilitators, academicians, and consultants towards a multi-pronged approach addressing incentivization of adoption of environmental approaches, knowledge sharing, renewable energy adoption and popularization, financial investment channel development and active research towards making the industry more sustainable. Technological advancement, access to green financing, and renewable sources will likely play key roles in deciding the future path toward a greener, more efficient, competitive, and sustainable apparel sector in the world.
Bangladesh is currently in a unique position wherein there’s both a push from the demand side internationally and an increasingly competitive landscape within national boundaries. Moreover, the plethora of research work by academicians regarding the RMG sector, particularly on sustainable technologies, means that through increasing collaboration across fields of engineering, innovation, and adoption of green technologies can be augmented and accelerated. With the pace at which EU regulations are being implemented, the survival of the biggest export sector now largely depends on the sector’s quick adaptation to the changing and challenging times of the future.
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