Brands Should Commit to Electrification Targets and Provide Financial Support to Suppliers in Building Renewable Electricity Capacity

An Apparel Impact Institute report calls upon apparel brands, textile manufacturers, policymakers, and financial institutions to take immediate action to accelerate decarbonisation even as it urges brands to commit to electrification targets and provide financial support to suppliers in building renewable electricity capacity and adoption, ensuring a more resilient and cost-effective supply chain.

Long Story, Cut Short

The report focuses on five of the top textile-producing countries: China, India, Vietnam, Bangladesh, and Indonesia.
It identifies the programmatic and policy needs—and key barriers to be addressed—for each low-carbon thermal energy technology to truly drive emissions reductions.
Brands and manufacturers must collaborate to assess their biomass supply chains and conduct a risk assessment on supply over time.

An Apparel Impact Institute report released today cites significant opportunities to decarbonise the textiles and apparel sector, addresses the challenges and even suggests a DIY roadmap on how to shift heat production to lower-carbon alternative fuels (sustainable biomass) in the near term and more efficient, clean, electrified processes in the longer term to achieve net zero.

The textile and apparel industry significantly contributes to global greenhouse gas emissions, accounting for approximately 2% annually.
A major challenge is the industry’s reliance on fossil fuel-based thermal energy for process heating (e.g., steam production and thermal oil heating) which contributes to substantial carbon dioxide emissions.
The industry increasingly recognises the need to decarbonise, especially as global demand for apparel grows.
Steam and thermal oil heating account for 50–60% and 30–40% of fuel used in a typical textile wet processing plant.

STRATEGIC CALL: The report calls upon apparel brands, textile manufacturers, policymakers, and financial institutions to take immediate action.

To accelerate this decarbonisation, brands are urged to commit to electrification targets and provide financial support to suppliers in building renewable electricity capacity and adoption, ensuring a more resilient and cost-effective supply chain.
As manufacturers implement efficiency measures and prepare for full electrification, policymakers and financial institutions must streamline regulations, enhance investment frameworks, and provide accessible funding mechanisms to drive widespread adoption.

THE REPORT: The Low-Carbon Thermal Energy Roadmap for the Textile Industry by the Apparel Impact Institute and written by Global Efficiency Intelligence provides a quantitative analysis of the energy, emissions, and cost implications, and identifies the programmatic and policy needs—and key barriers to be addressed—for each low-carbon thermal energy technology to truly drive emissions reductions.

The report focuses on five of the top textile-producing countries: China, India, Vietnam, Bangladesh, and Indonesia.
These countries represent a diverse range of policy, economic, and energy landscapes. Moreover, the textile industry’s economic significance varies widely in these countries, which affects the sector’s ability to influence policies or access limited clean energy resources.
The performance potential of each low-carbon thermal energy technology is very much tempered by the success of policies and incentives that will be required to promote their competitive advantage, maturation, and adoption
Authors: Ali Hasanbeigi, Cecilia Springer, and Dennis Wei.

STAKEHOLDER RECOMMENDATIONS: Each low-carbon thermal energy option in this report holds the potential for CO2 emissions reductions but faces serious challenges. Unaddressed, emissions and costs for textile manufacturing could increase in a worst-case scenario. To prevent this and ensure success, it’s critical to understand each technology’s techno-economic potential and the policies, regulations, programmes, and incentives required to deliver their success.

The stakeholder recommendations for the next 15 years, applicable for low-carbon thermal energy transition in textile plants across the studied countries, divides the roadmap into the:

Plan & Pilot Stage (2025 to 2030);
Deployment Stage (2030-2035);
and the ScaleUp Stage (2035-2040).
2025 to 2030 (Near Term — Plan & Pilot Stage)

Apparel Brands: Between 2025 and 2030, brands must lead funding to pilot heat pump projects in textile plants, particularly in China and India where renewable electricity (RE) is the most available RE.

Brand support in the following areas is pivotal: investing in the adoption of low-carbon technologies such as heat pumps; working with textile manufacturers to reduce thermal load through best practice energy efficiency, and piloting innovative technologies.
Brands can also promote renewable energy use by helping supply chain partners adopt cleaner energy solutions and advocating for RE in key regions.
Apparel brands should also verify sustainable biomass sourcing.
India and Vietnam must be cautious in expanding the textile industry’s biomass use, and Bangladesh and Indonesia face significant environmental and social risks, respectively, for biomass adoption.
Brands and manufacturers must collaborate to assess their biomass supply chains and conduct a risk assessment on supply over time.
Policy advocacy is essential to alleviate regulatory, market, and infrastructural barriers to electrification.

Textile Manufacturers: To lay the foundation for electrification, textile manufacturers should continue to improve energy efficiency and pilot innovative thermal load reduction technologies.

Brands should provide manufacturers with technical and financial support for pilot projects on lowcarbon technologies, focusing on heat pumps in China and India near-term and in the longer term in the other countries.
The role of textile manufacturers will include implementing these technologies in their operations to test feasibility and identify potential challenges.
Manufacturers should train their workforce to use and maintain new technologies, ensuring a smoother scale-up transition in the following stages:
Manufacturers should collaborate with apparel brands and other stakeholders to create long-term investment plans and secure brand commitment.

2030 TO 2035 (Deployment Stage) Apparel Brands: From 2030 to 2035, apparel brands should prioritise scaling successful pilots by promoting adoption within their supply chains.

They should encourage a broader set of suppliers to adopt low-carbon technologies and continue to provide financial support for expansion across regions.
As sustainable biomass supply declines and supply increases, brands should recommend phaseout.

Textile Manufacturers: Textile manufacturers must scale successful pilot projects and integrate renewable energy procurement into their operations.

Manufacturers should also analyse data from pilots to justify further electrification investment. Continued workforce development is essential as technologies expand.
Biomass phaseout should begin, with electrification plans for boilers reaching end-of-life or supply and cost issues.

2035 TO 2040 (Scale-Up Stage) Apparel Brands: By 2040, brands must integrate low-carbon thermal technologies into their supply chains. They should collaborate with manufacturers to share lessons learned and support technology scaling across facilities.

Ongoing technical, financial, and advocacy support will ensure textile manufacturers fully transition to electrification paired with RE.

Textile Manufacturers: In this final stage, textile manufacturers must complete the transition to 100% or near-100% RE-powered heating.

The transition is enabled by procuring only 100% RE from 2030 onwards and will require optimised operations, maximum energy and emissions reductions and engagement in utility programmes such as demand response and time of-use pricing.
Collaboration with other stakeholders will support the full adoption of electrification technologies.

Decision Tree for Textile Facilities Seeking to Adopt Low-Carbon Thermal Energy Technologies: The report also offers a simplified decision tree to help decisionmakers at textile facilities in the studied countries assess their best-fit low-carbon thermal heating option.

Facilities must first evaluate corporate RE procurement feasibility by 2030, as the analysis has shown that this is a key enabler of electrification decarbonisation.
If RE procurement is available, facilities should assess electrification options. The choice between electric boilers and heat pumps depends on the electricity-to-fuel price ratio and access to upfront capital. Electric boilers may be competitive in terms of energy costs with conventional boilers at an electricityto-fuel price ratio of about 1.2 based on their efficiency gains, while heat pumps may require additional CAPEX support — even without significant energy savings. Electric boilers only deliver reductions if the grid emissions factor is below 450 kgCO2/MWh.
If corporate RE procurement is not feasible, heat pumps can still reduce emissions — even with a carbon-intensive grid — due to their efficiency.
If the current grid emissions factor is too high and heat pumps are not financially feasible, the decision moves towards sustainable biomass. Biomass adoption is contingent on an uninterrupted, competitively priced supply with verified sustainability and the use of pollutant control technologies.
Facilities unable to meet these criteria should consider advocating for stronger RE procurement policies.

Applying this decision tree, heat pumps could deliver emissions reductions in all studied countries — even with the current grid emissions factor, while electric boilers would not reduce emissions and would require additional RE procurement.

This decision tree is a simplification: age and efficiency of existing boilers, available space, maintenance capabilities, specific process heat requirements, and other facility-level considerations also influence the choice of technology.
While this decision tree is a high-level guide, decisions will require a detailed, facility-specific evaluation.

METHOD: To develop the roadmap for textile plants to transition to low-carbon thermal energy, extensive baseline data was collected on textile wet-processing facilities in each country, including boiler systems, energy consumption, and process-specific heat requirements.

The study used detailed technoeconomic modelling to compare the performance and costs of alternative fuels and electrification technologies against traditional fossil fuel-based boilers, primarily coal-fired.
The analysis was conducted for a single, typical textile wet-processing plant in each country, rather than focusing on transitioning the entire industry in those countries to lower-carbon alternatives in the coming years. Projections were made for energy savings, emissions reductions, and energy costs.
For electrification technologies, the study assumed grid electricity would be paired with directly procured RE (e.g. Power Purchase Agreements, onsite generation), a growing trend in the textile industry.
It analysed two renewable energy procurement pathways for 2030, 2035, and 2040 in each country, differing by the share of procured RE relative to grid electricity: Baseline RE Procurement and Ambitious RE Procurement.
Additionally, for steam-producing technologies, the capital costs and projected annual operating costs were used to estimate an overall levelised cost of heat for steam generation that allows a more direct comparison of lifetime costs for each technology.

THE CONTEXT: The textile and apparel industry currently accounts for approximately 2% of total global anthropogenic greenhouse gas (GHG) emissions.

The textile industry has grown rapidly in recent years due to increasing demand from both developed and emerging economies. Without dramatic changes to production modes, environmental and climate impacts will increase.
A key challenge for the textile industry in lowering its carbon footprint is its heavy reliance on thermal energy primarily to produce steam and hot water for production processes.
Heating alone typically represents more than half of the textile industry’s total energy demand.
Textile plants primarily generate steam for heating by combustion boilers using fossil fuels. Thermal oil boilers (also known as hot oil boilers) are also used in wet processing at some textile plants, typically comprising 30-40% of total thermal energy demand.
In most countries, boilers in the textile industry use fossil fuels (coal, natural gas, or fuel oil) as an energy input, which results in substantial carbon dioxide (CO2) emissions.

WHAT THEY SAID:

We’re at this critical juncture. We’re half-way to 2030 when most brands have their interim targets. There is a lot of work to do in just five years to enable this longer-term transition. Immediate action is needed, and it should be a just transition. It’s a complete overhaul of where energy comes from and how these mills operate. That’s our call to action. We [the textile industry] can only achieve net zero by electrifying operations, with those operations using renewable electricity.

— Pauline Op de Beeck
Climate Portfolio Director
Apparel Impact Institute

We don’t have to wait until 2030. You can electrify tomorrow, and start on renewable energy procurement. Between now and 2030, I’m hoping we have 10 or more pilots for electrification of heating in textile plants in different countries, so people can see the electrification technologies work well in textile plants and begin to figure out the financing between different stakeholders for wide-scale adoption post 2030.

— Ali Hasanbeigi
Lead Author / Chief Executive Officer & Founder
Global Efficiency Intelligence

Brands need to start with what is easy and not focus on talking about what’s hard and what’s not possible. There’s nothing easier or cheaper for brands than renewable electricity and implementing that within the supply chain, but the tendency is always to focus on other more complex things, to avoid creating operational costs.

— Kim Hellström
Senior Sustainability Manager, Climate
H&M Group

I think there are few ways that brands and manufacturing collaborations can work, and I strongly believe that without putting real dollars on the ground, we are not going to be near the targets. I don't think the technologies pay for themselves, and we should not oversimplify the problem by saying that everything is affordable and easily implementable.

— Abhishek Bansal
Head of Sustainability
Arvind Limited

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