Bangladesh Garment Factories Slow to Adopt Solar Power
Despite having significant potential, less than one-third of garment factories in Bangladesh have adopted renewable energy technologies, including rooftop solar, due to barriers such as financing and limited space.
Bangladesh's garment sector has the potential to install up to 2,800 MWp of rooftop solar capacity, but less than one-third of factories have adopted renewable energy technologies. The country's energy system is facing intense pressure from the ongoing fuel crisis and rising electricity bills, making renewable energy such as solar a potential solution.
Barriers to Adoption
A recent study found that financing is a major barrier to the adoption of solar power, with many factories citing high installation costs and limited working capital. Industry insiders also believe that limited space and a lack of knowledge among owners are slowing the adoption of sustainable options. The study, which surveyed 661 factories in the cities of Gazipur and Savar, found that only 31% of factories have adopted renewable energy technologies, with half of all solar installations not contributing to production processes.
Financing and Infrastructure
According to industry insiders, access to finance remains one of the biggest obstacles to the adoption of solar power. Although Bangladesh Bank and IDCOL offer concessional financing for renewable energy technologies, factories often have to invest their own money first and wait for reimbursement, tying up scarce working capital for months. High import duties on balance-of-system components, such as mounting structures and electrical components, also increase the upfront investment and discourage many factory owners.
Large Factories Leading the Way
Some large factories, such as Ha-Meem Group and Plummy Fashions Ltd, have successfully adopted solar power and are reaping the benefits. Ha-Meem Group has installed 29.2 MWp of rooftop solar capacity and plans to add another 3 MWp this year, while Plummy Fashions Ltd generates around 13% of its electricity from rooftop solar. However, these factories are the exception rather than the rule, and many smaller factories are still struggling to adopt solar power due to the barriers mentioned earlier.
The Way Forward
To accelerate the adoption of solar power in Bangladesh's garment sector, the government and financial institutions need to address the policy bottlenecks and provide more incentives for factories to invest in renewable energy. This could include reducing import duties on balance-of-system components, providing more concessional financing options, and offering technical support to factories. With the right policies and incentives in place, Bangladesh's garment sector could unlock its significant potential for rooftop solar and reduce its reliance on grid electricity.
