Bangladesh's garment sector can meaningfully improve cost predictability and competitiveness by scaling up renewable energy but structural "carbon lock-in" rooted in machinery, finance and regulation, means the transition cannot be achieved through incremental efficiency measures alone, a new study by the Centre for Policy Dialogue (CPD) has found.
The findings were presented at a dialogue titled "Industrial Decarbonization in the RMG Sector: How to Take it Forward?" held at the BRAC Centre in the city on Sunday, part of CPD's National Dialogue on Industrial Decarbonization series.
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Sami Mohammad, Programme Associate at CPD, presented the paper, "Renewable Energy as a Competitiveness Strategy for Industrial Decarbonization in Bangladesh's RMG Sector." Khondaker Golam Moazzem, Research Director at CPD, chaired the event.
The study based on primary data from 350 RMG factories covering 78 machine types across nine production sections, is described as the largest factory-level production and energy dataset assembled for the sector.
According to the research, RMG accounts for 15.4 percent of Bangladesh's total greenhouse gas emissions, with the sector having pledged a 30 percent emissions cut by 2030 under the UN climate charter.
The study noted that pressure is mounting from the European Green Deal, the EU's Carbon Border Adjustment Mechanism, and Bangladesh's upcoming LDC graduation, alongside buyers' growing Scope 3 emissions demands.
Econometric modelling in the study found capital and energy behave as complements rather than substitutes in RMG production, meaning expanding machinery under existing technology raises energy use rather than reducing it, evidence the researchers describe as the empirical signature of technological lock-in.
The study also identified a core of "irreplaceable" machines, concentrated overwhelmingly in the sewing category, which holds 85.2 percent of installed machine capacity but yields under 3 percent of potential energy savings from substitution.
By contrast, cutting machinery, just 5.5 percent of the machine stock, accounts for 27.3 percent of total savings potential, while washing and dyeing was found to be the most energy-intensive stage of production despite its small footprint.
Rooftop solar was found to be financially viable and capable of hedging against volatile LNG-linked energy prices, with a Monte Carlo simulation showing renewable offsets reduce cost volatility for 96 percent of factories.
However, the study stressed that solar cannot address gas-fired thermal processes used in washing and dyeing, leaving a portion of emissions outside the reach of current renewable electrification.
Implementing the study's recommended machinery reallocation was estimated to cost between Tk 6,604 crore and Tk 13,209 crore, with costs concentrated heavily among the largest factories, which account for over 70 percent of the sector-wide bill.
The study recommended directing substitution incentives toward evidence-backed categories such as cutting and finishing, scaling renewable electrification alongside R&D on lower-energy sewing technology, targeting blended finance at smaller, capital-constrained factories, and shifting regulation from procedural compliance toward outcome-based, measurable emissions reporting.
Speakers at the dialogue said decarbonizing the RMG sector requires coordinated technological, financial, institutional and behavioural interventions, noting that partial measures alone would not be sufficient to break the sector's carbon lock-in.