European brands plan wind farm project in Bangladesh

Two major European clothing brands — H&M Group of Sweden and Bestseller of Denmark — are planning a 500-megawatt (MW) offshore wind project in Bangladesh, taking a pioneering step towards sustainable energy.

The initiative is part of a broader shift by the ready-made garment sector to green energy across the country. It is also the first energy infrastructure project by a foreign apparel brand in Bangladesh, according to industry insiders.

H&M Group and Bestseller signed a development agreement with Copenhagen Infrastructure Partners (CIP), a Danish renewable energy company, last year, the Ministry of Energy, Power and Mineral Resources (MPEMR) announced.

CIP is currently conducting a feasibility study for a 500 MW project along the Cox’s Bazar coast in the Bay of Bengal. Final work is expected to begin in 2028 if positive results are obtained, ministry officials said.

Faruque Hassan, former president of Bangladesh Garments Manufacturers and Exporters Association (BGMEA), is a key figure in this initiative. In an interview with The Business Post, he emphasised the importance of adopting climate-friendly business practices.

Saying that the project will be a milestone for the country, he also highlighted that the Global Fashion Agenda (GFA) played a key role in encouraging the two international fashion brands to invest in the wind power project in Bangladesh.

According to the Bangladesh Power Development Board (BPDB), the country’s current generating capacity is 30,277 MW. Most of it is generated from imported fossil fuels, which requires a significant amount of foreign exchange and increases economic risks.

Experts are calling for maximum use of renewable energy in all sectors, including the clothing industry, which currently accounts for only 2 percent of total renewable energy production.

The GFA indicates that apparel companies have committed to reducing their emissions by at least 50 percent by 2030 and achieving net zero emissions by 2050.

Recently, at an event in Dhaka, the European Union Ambassador to Bangladesh, Charles Whiteley, underlined the EU’s commitment to developing 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 transition to renewable energy in Bangladesh’s textile industry through a €15 billion credit line.

70% of emissions come from mining activities

GFA data shows that around 70% of the fashion industry’s emissions come from upstream activities, such as manufacturing, which relies heavily on coal, oil and gas as a source of electricity.

Bangladesh – accounting for almost 8% of global apparel exports and the third largest exporter after China and the EU – stands to benefit significantly from this renewable energy project.

According to the GFA, the planned installation of a 500 MW offshore wind farm is expected to reduce the country’s annual carbon dioxide emissions by around 725,000 tonnes.

Nirod Chandra Mondal, secretary for renewable energy under MPEMR, told The Business Post that the final report of the three-year feasibility study that CIP is conducting along the Cox’s Bazar coast is expected in two years. The project aims to attract an investment of $100 million, depending on the outcome of the study.

RMGsector reported that H&M, one of the world’s largest fast fashion brands, recorded a 3 percent reduction in scope 3 emissions in its latest 2022 Sustainability Report. The company aims to achieve a 56 percent reduction in scope 3 emissions by 2030, based on 2019 data.

CIP, the largest fund dedicated to greenfield renewable energy projects, has raised about $28.4 billion for such activities, according to its website.

Faruquesaid: “We are trying to create a major renewable energy revolution in the RMG sector by 2030. For now, the shift towards green energy is through solar energy. I believe that the investment of two global apparel brands in green energy in Bangladesh has opened the door.

“If the project is successful, it is to be expected that other clothing brands will also be interested in investing in this sector.”