Energy sovereignty must guide RMG strategy, industry leaders say

Bangladesh's ready-made garment (RMG) sector faces growing risks from fuel-import dependence, rising costs and unreliable supply, industry leaders and energy experts said, urging the country to put renewable energy transition and energy sovereignty at the centre of its long-term industrial strategy.

The call came at the "Rapid Energy Transition Conference: Powering Security, Sustainability and Growth in Bangladesh RMG", convened by Ethical Trading Initiative (ETI) Bangladesh on Monday (7 September), according to a press release.

The conference, convened by Ethical Trading Initiative (ETI) Bangladesh, brought together 108 representatives from RMG factories, with speakers from business associations, international brands, financial institutions, renewable energy companies and technical organisations.

Three working sessions focused on the urgency of the transition, financing and technology options, and the role of business associations in supporting implementation across the industry.

In his opening address, ETI Bangladesh Executive Director Abil Bin Amin called for a just and collaborative transition.

He said factories and workers should not bear the costs of meeting international climate targets and shifting to renewable energy without collective engagement and stakeholder support.

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Director Eng Imran Kader Turjo warned that rooftop solar alone could not secure the RMG sector's energy future.

"We are already late; these renewable-energy and infrastructure initiatives should have been implemented 10 to 12 years ago. Our priority now must be rapid and focused implementation," he said.

Turjo advocated combining factory rooftop solar, reliable grid electricity, larger renewable energy facilities on suitable land and appropriately assessed storage systems.

Nishat Nahrin Hamid, Chairman of the Bangladesh Garment Manufacturers and Exporters Association's (BGMEA) Standing Committee on Energy Optimisation, said renewable energy had become fundamental to production security and competitiveness.

"As an industry, we must become more independent when it comes to energy. Energy sovereignty must be part of Bangladesh's industrial resilience strategy," she said.

Nishat cited a BGMEA survey of 453 factories that identified approximately 165–170MW of untapped rooftop solar potential.

Despite strong interest among factories, investment costs, limited roof space, inadequate technical support and difficulty accessing affordable finance continued to impede implementation, particularly among smaller businesses.

She called for predictable multi-year policies, technically viable solutions, stronger grid infrastructure and bankable power-purchase agreements.

Nishat also urged international brands to align their sustainability and procurement teams so that environmental expectations were reflected in pricing, purchasing practices and direct support for factories.

Lindex South Asia Regional Sustainability Manager Kazy Mohammad Iqbal Hossain echoed the call, saying responsibility for the transition could not rest with factories alone.

He called for fairer purchasing practices, closer coordination between brands' sustainability and procurement teams, and longer-term sourcing relationships.

Bangladesh Solar and Renewable Energy Association (BSREA) President Mostafa Al Mahmud said regulatory delays, unclear pricing, taxation and inadequate upfront financing had made the transition more difficult and expensive.

"Delay is costly. There is no alternative to renewable energy," he said.

Mostafa said refinancing after expenditure could not, on its own, meet factories' upfront investment needs. He called for faster approvals, clearer electricity-purchasing arrangements and appropriate tax treatment.

The first working session featured keynote presentations by ETI Bangladesh Senior Programme Officer Priyong Sabastini and Coastal Livelihood and Environmental Action Network (Clean) Chief Executive Hasan Mehedi.

Priyong said the RMG sector faced a worsening domestic energy crisis alongside mounting global pressures linked to graduation from least developed country status, EU regulations and brands' net-zero commitments.

An accelerated renewable energy transition was therefore essential to the sector's long-term resilience and competitiveness, Priyong said.

Hasan Mehedi linked the energy crisis to Bangladesh's growing exposure to imported liquefied natural gas (LNG), coal, oil and cross-border electricity.

He said imported LNG's share of the country's gas supply had increased from around 11% in FY2018–19 to 35% in FY2025–26.

"We should not wait until 2029 to begin preparing for 2030. The preparation has to start now," he said.

Mehedi presented estimates of the potential benefits of increasing industrial solar capacity to 2,000MW by 2030.

According to Clean, this capacity could generate around 3.1 billion units of electricity annually and avoid up to Tk5,713 crore in furnace-oil costs each year if solar output displaced furnace-oil generation.

He also presented a 10kWp rooftop solar model costing Tk7.5 lakh. Clean estimated that the system could save an industrial user approximately Tk17.5 lakh over 20 years compared with buying the same amount of electricity at the assumed industrial tariff.

Ha-Meem Group General Manager Ashis Kumar Basak highlighted the commercial benefits of the transition.

He said solar power had reduced the group's blended electricity cost by approximately Tk1–1.25 per unit, with an estimated payback period of 4.5 to six years.

BRAC Bank Senior ESG Specialist Farzana Rahman and ESG Specialist Tasfin Fahad explained that eligible green projects could access certain concessional refinancing facilities through participating commercial banks.

Access would depend on documentation, technical evidence, project viability and credit assessment, they said.

Participants recommended turning national and RMG renewable energy ambitions for 2030 into annual installation targets, with clear responsibilities for the institutions involved.

They called for affordable financing before installation, based on projects' technical and commercial viability, rather than relying solely on post-completion refinancing.

The recommendations also included fixed approval timelines and a one-stop net-metering process to ensure factories' exported electricity was properly recorded and credited against their bills.

Participants proposed allowing factories to buy renewable electricity directly from independent generators through merchant or corporate power-purchase agreements, supported by transparent and commercially workable grid-use charges.

They also recommended clustered solar arrangements through which five to 10 smaller factories could combine projects, lower transaction costs and improve access to financing.

Predictable multi-year industrial electricity pricing was identified as another priority to help factories assess investments and negotiate longer-term commitments with international buyers.

The conference called for a credible domestic system to track renewable electricity generation and renewable energy certificates, allowing factories with limited rooftop capacity to support renewable projects within Bangladesh and transparently report their contributions to buyers.

Participants also urged brands to align sustainability targets with purchasing practices, financing, fairer prices and longer-term sourcing support.

Other speakers included BKMEA Compliance Cell Joint Secretary Farzana Sharmin; BGMEA Circular Fashion Unit Senior Assistant Secretary Sajjadul Alam; Greener Garments Initiative CEO Nure Alam; and Development Anthropologist UKM Shawkat Ara Begum.

Closing the conference, ETI Bangladesh Director of Programmes Munir Uddin Shamim stressed the human consequences of energy insecurity.

He said unreliable energy ultimately affected workers, their incomes and their families, making it essential for the renewable energy transition to remain commercially viable and socially just.