Summary
- To remember: the fashion industry emits as much CO2 as a G7 country.
- Energy abundance has kept the textile industry in a linear production model: production, use, then destruction. This model has allowed for a reduction in costs and prices, but remains environmentally inefficient.
- The clothing industry is a victim of an energy rebound effect: in spite of advantageous energy and market conditions, and in spite of the digitalization that has helped second hand's emergence, the rate of use of our clothes is constantly decreasing.
- A little hope: industry players have developed new methods to reduce the carbon footprint of clothing.
- Upcycling and reusing scraps is an effective way to transform the industry and reduce its impact.
- Making less without destroying value: the fashion industry's new impactful business models.
1 - The fashion industry emits as much CO2 as a G7 country
According to a Quantis study (BCG), the textile industry as a whole (from production to distribution), represents 8% of global greenhouse gas emissions (2016), or as much as a country like France (c.4 million tons of CO2 equivalent). In addition, these emissions are equivalent to those of global air and sea transport combined each year.
Contrary to popular belief, it is neither transportation nor distribution that weighs most heavily on the industry's carbon footprint. In fact, a significant part of the environmental impact comes from the upstream production phase. Spinning and dyeing, or bleaching, alone account for 28% and 36% of the sector's total emissions respectively, due to the significant energy required for each of these stages. Moreover, India, China and Bangladesh, which are among the largest producers, have an energy mix that is largely dependent on non-renewable energy (coal and natural gas).
2 - Energy abundance has kept the textile industry in a linear production model: production, use, then destruction. This model has allowed a reduction of costs and prices, but remains inefficient from an environmental point of view
The textile industry is built on a linear mode of production and consumption: use of non-renewable resources extracted for the manufacture of clothes which are under-used in time, then often thrown away or destroyed. Logically, this model encourages over-production and therefore over-consumption, due to low labor and raw material costs. The abundance of fossil fuels (oil, coal, gas) is directly correlated to these low costs. In addition, the upstream of the value chain does not encourage the reuse of materials in view of the production prices.
As a result, only 1% of production materials are recycled to make new clothes. A topic already explored at Azala, the amount of fabric discarded before it is even used is immense, nearly 60 billion square meters of fabric are discarded each year in the production of fabrics (between 15 and 20% of the volume of fabric produced). This huge loss is also an indicator of possible improvements and optimizations, especially by changing the method of arbitrage beyond the price factor. Logically, this new economy will need more and more profiles trained to these new skills and new constraints. Responsible buyers or responsible supply chain managers will be at the heart of the transformation process, by modifying their choice of suppliers and materials in order to take into account the negative externalities of the industrial production of clothing (energy costs, CO2 emissions, etc.).
3 - The clothing industry is a victim of an energy rebound effect: in spite of advantageous energy and market conditions, and in spite of the digitalization that has helped second hand's emergence, the rate of use of our clothes is constantly decreasing
The abundance of affordable primary energy in producing countries, coupled with the massification of production in those same countries, has led to a significant drop in manufacturing costs and product prices. Although the share of the household budget devoted to clothing has steadily declined since 1960 (from 9% in 1960 to 3% in 2015), the decline in prices has not been fully incorporated (see graph below). Similarly, while the decline in costs is partly reflected in prices, overall purchase volumes have continued to rise. In other words, lower prices have resulted in consumers buying more products. This implies that products are less worn, and that industry emissions have increased drastically.
Moreover, the arrival of digitalization with exchange platforms such as Ebay, Leboncoin or Vinted more recently have not reversed the trend (increase in volumes manufactured and sold). Once again, cost reduction and accessibility (user experience) has contributed to the overall increase in consumption. According to BCG, 70% of platform users would resell their products second hand in order to increase their purchasing power on the new market, despite the CSR approach of these platforms.
4 - A little hope: industry players have developed new methods to reduce the carbon footprint of clothing
The implacable ecological situation has encouraged manufacturers to innovate, partly under the pressure of brands engaged in their own transition. The least expensive measures in financial or technical terms were the first to emerge, because the price constraint imposed by the principals does not seem to have changed. These still low prices make the transformation of the industry difficult. However, some players have found innovative solutions, like Decathlon, in partnership with its Asian suppliers, which has introduced at least one cold dyeing technique, significantly reducing the energy requirement of the process.
To this end, Décathlon has appointed a supply chain manager in charge of low-carbon purchasing and new manufacturing processes. A job with a future. There are many examples of innovations. A new dyeing process for the manufacture of the inner lining of a down jacket has made it possible to reduce carbon emissions by 40% and those of fine particles PM 2.5 ppm by 66%.
5 - Upcycling and reuse of offcuts: an effective way to transform the industry and reduce its impact
Innovations aimed at decarbonizing the textile industry are numerous and are segmented across all stages of the fashion industry's value chain (spinning, weaving, garment making, sales, recycling/upcycling). As mentioned above, the recycling of clothing is at the heart of ecological concerns because the manufacturing and transformation of raw materials represents on average nearly 80% of a garment's carbon emissions. Therefore, our ability to design new products from existing materials can have a significant impact on the industry's bottom line. Upcycling is the name of the process that describes the transformation of used clothing or fabric scraps into new clothing. This process has the advantage of acting on all the links in the life cycle of a garment: it replaces in part the manufacture of raw materials and allows the reimportation of part of the manufacturing in areas where the electricity is less carbon. In addition, the recycling of fabric scraps or used clothing allows us to directly influence the quantity of waste produced.
6 - Manufacturing less without destroying value: the new impact business models of the fashion industry
If solutions exist to make the textile industry more in line with the challenges of ecological transition, the fact remains that the reduction of global consumption is inevitable. A substantial part of our clothes is worn less than 10 times before being thrown away, given away, lost or resold. This observation encourages us to think about ways to promote the extension of the use of textile products. From the consumer's point of view, the answer seems simple and aims at orienting the act of purchase towards a better quality consumption, while promoting the circularity of clothing, via resale or donation.
From the point of view of manufacturers and retailers, possibilities exist to build more virtuous business models (provided that they do not generate an increase in sales via the rebound effect of savings made towards more new purchases): pre-ordering, renting clothes, reselling second choices, recycling / upcycling, etc. This non-exhaustive list of "new" business models goes in the direction of a more circular and less carbon-based economy. Indeed, it is in the best interest of brands to think about viable models over the entire lifespan of their products in order to continue creating value without producing more.
The fashion industry is in the absolute necessity of transforming itself in order to respond to climate issues. While the industry's carbon footprint is very large, there are many viable solutions to reduce the greenhouse gas emissions it generates. In this sense, it is necessary to consider a garment by its global footprint, beyond the price. From the buyers' point of view, the trend of a more eco-friendly consumption is more and more prevalent, and from the public authorities' point of view, it seems necessary to support this trend by taking into account the imported pollution in the taxation of the products; in order to reflect a fair price regarding the ecological considerations.
In addition, beyond the carbon footprint of the industry, the means to manufacture less raw materials must significantly limit the destruction of biodiversity directly related to the manufacture of clothing (micro-particles, water pollution, deforestation, etc...).
Joseph Hermet for KLIMA School and Sofiane Bouhali for Azala