A new study by Bengaluru-based climate research organisation Climate Risk Horizons indicates that Tamil Nadu’s textile industry could significantly reduce operating costs and enhance competitiveness by shifting to renewable energy sources.
Titled “Fashioning a Net Zero Future for Tamil Nadu’s Textile Sector”, the report was jointly published with Energy Transition Ventures and authored by researchers Rakesh Ranjan Kumar and Arundhati Muthu. It examines industrial energy consumption patterns, export performance, and field insights from key textile hubs including Tirupur, Coimbatore, and Erode.
The study arrives amid rising fuel and energy costs driven by global crude oil volatility, highlighting how decarbonisation could offer both financial and environmental benefits for the sector.
According to the report, Tamil Nadu’s textile and apparel industry, which employs over 8.6 lakh workers and contributes nearly 17% to the state’s manufacturing GVA, accounts for around 27% of India’s textile exports. However, increasing energy costs are putting pressure on margins, with total energy expenditure rising by nearly 47% between 2020–21 and 2023–24.
Electricity forms about 80% of the sector’s energy usage, while the rest comes from petroleum products, coal, and biomass. The report notes that petroleum alone accounted for 12.6% of total energy spending in 2023–24.
The findings suggest that a full transition to renewable electricity through green tariffs and open-access systems could reduce power costs by up to 41.5%, generating annual savings of approximately ₹3,250 crore. Even under conservative estimates, savings could still exceed ₹2,300 crore per year. Additional savings of ₹1,560 crore to ₹2,770 crore could be achieved by replacing fossil-fuel-based heating systems with electrified clean alternatives.
Beyond cost benefits, the report also highlights environmental concerns, noting that India’s textile sector has one of the highest carbon footprints among major exporting countries. Emissions are estimated at over 12.5 kg CO₂ equivalent per kilogram of textile produced, significantly higher than Vietnam, Bangladesh, and China.
The study also warns that rising biomass usage in textile clusters may be contributing to deforestation pressure in surrounding regions. It estimates that biomass consumption over the past decade could correspond to the loss of tens of millions of trees.
Despite Tamil Nadu’s early adoption of wind energy, the report identifies several barriers to renewable energy expansion, including high green power costs, grid limitations, and infrastructure constraints.
It concludes that accelerating clean energy adoption is essential not only for sustainability but also for protecting the long-term export competitiveness of Tamil Nadu’s textile industry, especially as global regulations such as the EU Carbon Border Adjustment Mechanism (CBAM) tighten.
The study calls for coordinated action between government bodies, regulators, industry associations, and global brands to enable large-scale investment in renewable energy and low-carbon infrastructure across the textile value chain.
