Green Power Procurement in the Indian Textile Sector
Case Study: Arvind Ltd
Date of release: November 2024
The textile sector in India is among the most energy-intensive industries and is currently undergoing a pivotal transformation. It accounts for more than 4% and 5% of the total industrial energy consumption and emissions, respectively. There is an increasing pressure from the government and end consumers to adopt sustainable practices and improve energy efficiency. Thus pushing the sector to explore utilization of decarbonization technologies.
Achieving decarbonization in the textile sector necessitates the strategic use of renewable energy (solar and wind), biomass, and energy efficiency enhancement solutions. These energy enhancement solutions include Variable Frequency Drives (VFDs), industrial heat pumps, Waste Heat Recovery Systems (WHRS), and electric boilers. Adoption of renewable electricity, especially for already electrified processes, is a strategic low-hanging fruit opportunity for sector decarbonization. Increasing biomass usage by either blending it with coal or using biomass-specific boilers represent another feasible means of reducing sector emissions.
Unlike other industrial sectors, the textile sector in India is highly fragmented. The Small and Medium Enterprises (SMEs) makes up about 75% of the market share and contribute a similar proportion to the industry’s total energy consumption. The smaller fragmented players are increasingly adopting RE through solar rooftops and captive open access mechanisms, while the larger players are additionally increasing the share of biomass in its thermal energy consumption.
Arvind Ltd. is one of India’s largest textile manufacturing companies with a presence across the entire textile value chain ranging from raw material processing to retail distribution. The company operates nine manufacturing facilities across three Indian states of Gujarat, Maharashtra, and Karnataka. In FY2024, the renewable sources including solar, wind, and biomass accounted for ~43% of its total annual energy consumption of 9771 TJ. Additionally, the company has set an ambitious target that aims to increase the share of RE to 90% within the next two years. In FY2024, the use of renewable energy (including biomass) by Arvind Ltd has led to annual cost savings of Rs 329 crores (US$ 39 million). Most of this (around 84%) is from the cost savings in additional coal procurement costs due to its biomass substitution.
Considering the three scenarios outlined in the figure below, JMK Research estimates that the Indian textile sector will integrate up to 4 GW of solar and wind capacity and will require about 6 MMT of biomass annually (equivalent to boiler capacity of ~3900 TPH). Thus, necessitating an estimated investment of about US$ 3 billion by 2030. Moreover, a substantial portion (around 70-80%) of investment cost pertaining to biomass is recurring due to the supply chain expenses of biomass procurement.
Figure 1: Expected RE installations in Textile Industry in India under various scenarios by 2030
Source: JMK Research Analysis
Note – These scenarios are not mutually exclusive. A combination of these scenarios is expected
Table of Contents
- Indian Textile Sector Overview
- Textile Manufacturing Process
- Ways to Decarbonize Textile Sector
- Decarbonization Initiatives in Textile Sector
- Case Study- Arvind Limited
• Company Overview
• Energy Consumption and Emissions – Segment wise
• Renewable Energy Installations
• Renewable Energy Consumption Trends
• Renewable Energy Benefits
• Outlook & Other Sustainability plans - Way Forward for Textile Sector
Enter the E-mail ID to download the report