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Bangladesh’s ready-made garment (RMG) industry can cut greenhouse gas emissions by nearly 4.5 million tonnes in 20 years if only 10 per cent of the factories start operating on solar power, says a study.
The Centre for Policy Dialogue (CPD) study findings were presented at a dialogue titled “Green Growth and Just Transition in Bangladesh: The Need for Corporate and International Cooperation” at The Westin Dhaka on Tuesday.
The event was organised by Oxfam Bangladesh. On behalf of CPD Executive Director Fahmida Khatun, Visiting Fellow Estiaque Bari presented the findings.
Estiaque said, “If 10 per cent of the current RMG sector’s energy demand can be met by solar, it will produce a maximum of five lakh tonnes of emission in 20 years, which will be 10 times lower compared to emissions produced by electricity generated by natural gas.
“Our preliminary estimate suggests that it takes seven to eight years to reach breakeven after investing in solar power. With a 20-year lifetime of solar panels, a factory can enjoy net benefits for an additional 10-12 years with a diminishing rate of efficiency.”
According to the US-based National Renewable Energy Laboratory estimation, solar power produces lifetime emissions of 40g of carbon dioxide and other greenhouse gases per kilowatt-hour.
The estimated electricity demand at the active member factories of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) is 6,251GW/h, which is 7.3 per cent of the total electricity generated in the country.
The RMG sector is the country’s largest industrial contributor to carbon dioxide emissions at 15.4 per cent, followed by the textile sector at 12.4 per cent.
Considering the current market prices to install 1MW solar power capacity, it will cost the RMG sector nearly $0.8 million.
But to install the same capacity, it will cost independent power producers around $1.4 million. However, only land preparation will account for 26 per cent of the independent power producers’ cost, according to the study.
“This shows RMG factories do not need to invest in land as solar panels can be set up on rooftops. This is the advantage in the RMG sector,” Estiaque said.
Currently, 3.69 per cent of electricity in the country is generated from renewable sources, including solar.
Earlier at the beginning of the programme, Ashish Damle, Oxfam Bangladesh country director, discussed the term just transition. He said just transition addresses energy transition along with climate justice in every social aspect, including labour rights and environment protection.
“There is a shared responsibility of corporates, the developed world, and all stakeholders while the wellbeing of the people will be at the centre of it,” he said.
Barriers in RMG sector
At the industry level till January this year, 173 RMG factories received LEED certification while another 547 have applied to the US Green Building Council.
BGMEA President Faruque Hassan said small and medium factories cannot avail support due to a number of conditions.
“The lack of capital investment is a barrier to becoming a LEED-certified factory. We are working on it so that small and medium factories can avail financial support from the government and other donors,” he said.
Mostafiz Uddin, managing director of Denim Expert, said, “According to the Fashion Industry Charter for Climate Action, RMG factories have to reduce emissions by 50 per cent by 2030 not only in the units but also across the whole value chain, which is not possible.”
He said Western buyers making huge profits are not interested in taking on a shared responsibility.
“Buyers source a product at $6 but sell to consumers at $30-40. If they contribute even 5 per cent of their earnings to make our industry green, there would be a great achievement in green transition,” he explained.
Mostafiz said development partners are giving loans at lower interest rates but those are not charity or grants. “Moreover, consultancy and other fees to avail loans are huge.”
Saber Hossain Chowdhury, chair of the Parliamentary Standing Committee on the Ministry of Environment, Forest and Climate Change, said the Fashion Industry Charter for Climate Action is not aligned with Bangladesh’s national emission cut target.
“Our RMG exporters get less than 20 per cent of the actual product price. Around 400-500 litres of water would once be needed to produce 1kg RMG, which has now come down to 100 litres. It is depleting our groundwater level,” he said.
“Our emission is 0.4 per cent of the global figure, but we face gross domestic product losses, water stress, and displacement,” he also said.
“They [buyers] will make money by selling products that we make, but they will not give us our fair share. This is the highest level of commercial injustice,” Saber added.
Mostafiz accused Bangladesh Export Processing Zones Authority (BEPZA) of not giving net metering permission in the factories inside BEPZA.
That is why solar panel installation cannot gather pace, he said.
Saber, meanwhile, urged Power Cell and other related agencies to work on the matter.
Mohammad Hossain, director general of Power Cell, said, “I am not aware of this. We will not allow any monopoly attempts in BEPZA.”
