YANGON – Myanmar’s garment production sector is looking to cut down on CO2 emissions and boost environmental performance with the signing of a new MoU between the Smart Myanmar project and AYA Bank. The project aims to jointly identify and pilot bankable green projects within 2019, and guide more substantial green lending programmes in the years to come. As an EU funded project working with hundreds of garment factories on technical consultancy, Smart Myanmar is well positioned to scope potential green projects for AYA Bank – Myanmar’s fastest growing bank – and advise loan managers in piloting new green lending services.
Explaining the need for the collaboration, Jacob Clere, team leader with Smart Myanmar, told Apparel Insider: “We can identify ways to save money and energy, oftentimes quite a significant amount, but factories are reluctant to invest in the upfront costs. In Myanmar, due to the chaotic years of military rule, the banking sector was ravaged and local banks are not too experienced at reaching out to and evaluating SMEs for loans. As a project, Smart Myanmar seeks to fill the technical and knowledge gaps in these areas. We do this on the factory floor and also in the offices of the banks.
“Low interest loans are not yet possible in Myanmar, so we are targeting the lowest hanging fruit – the factories with old boilers and steam systems who can upgrade to more efficient designs. In some cases, even a high interest loan can be paid back quickly via the energy savings.
“It’s an interesting time for technology in the Myanmar garment industry. Most of the factories producing here are now brand new, with sophisticated and modern production facilities, but many are also older and playing catch-up.”
Clere tells the story of one factory which is in the process of shifting to the use of rice husk pellets for boiler fuel, to replace coal.
Rice husk pellets are made by compacting rice husk, which is obtained as a by product of rice growing. It has similar characteristics to wood pellets but is more environmentally friendly, as the raw material is a waste product.
Pellet fuels (or pellets) are biofuels made from compressed organic matter or biomass. Pellets can be made from any one of five general categories of biomass: industrial waste and co-products, food waste, agricultural residues, energy crops, and virgin lumber
Adds Clere: “The quickest positive upgrade most factories can make is to improve their performance monitoring on energy and emissions. Once they get in the habit of tracking such data – especially normalised metrics like kWh per 1,000 sweaters or kWh per 1,000 ski jackets, etc.- they will have a benchmark from which to push for efficiency and reduction.”