In a first as well as a ground-breaking move towards sustainable energy, two major European clothing brands — H&M Group of Sweden and Bestseller of Denmark — are planning to develop a 500megawatt (MW) offshore wind project in Bangladesh.
This initiative is part of the readymade garment sector’s broader shift towards green energy around the country. It also represents the first energy infrastructure project by foreign clothing brands in Bangladesh, according to sector people.
According to the Ministry of Power, Energy and Mineral Resources (MPEMR),H&M Group and Bestseller signed a development agreement with the Copenhagen Infrastructure Partners (CIP), a Danish renewable energy company, in this regard last year.
CIP is currently conducting a feasibility study for the 500 MW project along the Cox's Bazar coast in the Bay of Bengal, with the final work expected to begin by 2028, pending positive results, said ministry officials.
Faruque Hassan, former president of the Bangladesh Garments Manufacturers and Exporters Association (BGMEA),is a key figure playing an important role in this initiative. Talking to The Business Post,he emphasised the importance of adopting climate-friendly business practices.
Saying this project will be a milestone for the country, he also highlighted that the Global Fashion Agenda (GFA) has been instrumental in encouraging these twointernational fashion brands to invest in the wind energy project in Bangladesh.
According to the Bangladesh Power Development Board (BPDB), the nation’s current power generation capacity stands at 30,277 MW. Most of it is generatedfrom imported fossil fuels, which requires a significant amount of foreign currency and increases economic risk.
Experts have called for maximising the use of renewable energy across all sectors, including apparel, which currently contributes only 2 percent of the total power generation from renewable sources.
The GFA indicates that fashion companies have pledged to reduce emissions by at least 50 percentwithin 2030 and achieve net zero by 2050.
Recently, at an event in Dhaka, European Union Ambassador to Bangladesh Charles Whiteleyhighlighted the EU’s commitment to develop the green energy market in South Asian countries, including Bangladesh. The EU has issued green bonds to support this initiative and aims to facilitate the shift to renewable energy in Bangladesh’s textile industries through a 15 billion euro credit facility.
70% emissions from upstream activities
GFA data shows that approximately 70 per cent of fashion industry emissions come from upstream activities, such as manufacturing, which heavily rely on coal, petroleum and gas for electricity.
Bangladesh — accounting for nearly 8 per cent of global clothing exports and ranking as the third-largest exporter after China and the EU — stands to benefit significantly from this renewable energy project.
The planned 500 MW offshore wind installation is expected to cut the country’s annual emissions by an estimated 725,000 tonnes, according to GFA.
Nirod Chandra Mondal, the joint secretary of the Renewable Energy Wing under MPEMR, told The Business Post that the final report of the three-year feasibility study the CIP is conducting along the Cox's Bazar coast is expected in two years. The project aims to attract a $100 million investment, depending on the study's outcomes.
RMGsector insiders said that H&M, one of the world's largest "fast fashion" brands, reported a 3 per cent reduction in Scope 3 emissions in its latest sustainability report for 2022. The company aims to achieve a 56 per cent reduction in Scope 3 emissions by 2030, based on a 2019 baseline.
CIP, the largest dedicated fund focused on renewable energy projects in undeveloped "greenfield" areas, has raised approximately $28.4 billion for these activities, according to its website.
Faruquesaid, "We are trying to bring about a major revolution in renewable energy in the RMG sector by 2030. For now, the green energy shift is happening with solar power. I believe that the investment of two global clothing brands in green energy in Bangladesh has opened a door.
“If successfully completed, it is expected that other clothing brands will also be interested in investing in this sector.”
