TCF POST Report
The recent introduction of Corporate Power Purchase Agreements (C-PPAs)—agreements allowing companies to buy electricity directly from renewable energy developers—has offered garment export industries in Bangladesh and Vietnam a significant competitive advantage, according to a senior official at the Swedish retailer H&M.
Kim Hellström, Head of Sustainability at the H&M Group, advised Cambodian garment manufacturers to follow the proactive steps taken by Vietnam, Bangladesh, and China. He warned that if competitor countries remain unable to demonstrate certified green energy production, they risk losing brand orders to nations with superior green regulatory frameworks.
“At H&M Group, we are committed to source 100% renewable electricity for our garment production supply chain – from spinning to finished product – by 2030,” Kim added.
He pointed out that it is important that the renewable electricity options remain available and are preferably even expanded further. “In the long-term, our decarbonization strategy focuses on electrifying factory processes that currently rely on thermal energy sources such as fossil fuels or biomass. This is especially applicable to dyeing and printing mills.”
According to LightCastle Partners, an international management consulting firm, renewable energy currently accounts for less than 6% of Bangladesh’s power mix. However, C-PPAs have offered a transformative mechanism for Bangladeshi corporations to procure clean energy directly from producers, effectively bridging the financing and policy gaps that historically hindered progress.
LightCastle Partners noted that C-PPAs can accelerate Bangladesh’s renewable energy transition and safeguard the competitiveness of its export-oriented industries, particularly the Ready-Made Garment (RMG) sector. Ultimately, the firm highlights C-PPAs not just as a climate imperative, but as a critical survival strategy for Bangladesh’s manufacturing sector in an increasingly low-carbon global economy.