The real carbon hotspots in fashion aren’t where brands look first

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🗞️ Driving the news: New data shows that Tier 2 suppliers, textile mills responsible for dyeing and fabric finishing, are the largest source of carbon emissions in fashion supply chains, generating over 50% of Scope 3 emissions
• Emissions are concentrated among a relatively small number of large mills, offering a high-impact opportunity for targeted intervention

🔭 The context: While brands have focused sustainability efforts on Tier 1 (assembly), the upstream Tier 2 segment has largely escaped scrutiny
• According to Cascale and McKinsey, Tier 2 accounts for up to 70% of supply chain emissions. Key challenges include reliance on thermal energy, primarily from coal-fired boilers, which is harder to replace than electricity
• Current renewable energy usage across both tiers is just 2%

🌍 Why it matters for the planet: Addressing Tier 2 emissions is critical for fashion to meet climate targets
• Targeting major mills with clean heat technologies such as biomass boilers or electrification can lead to substantial emissions cuts
• Without systemic decarbonization of textile processing, fashion's climate footprint will remain far above acceptable thresholds

⏭️ What's next: Initiatives like the Apparel Impact Institute’s Climate Solutions Portfolio and the Fashion Pact’s Future Supplier Initiative are accelerating support for low-carbon upgrades in Tier 2
• Open-source tools and blended financing models are being deployed to help mills electrify
• With brands like H&M, Patagonia, and Levi’s already piloting clean heat solutions, wider adoption will likely hinge on collective action and long-term investment strategies

💬 One quote: “Because emissions are concentrated in a small number of suppliers, we can target our conversations to a smaller subset… where interventions will really make a difference,” said Joel Mertens of Cascale

📈 One stat: Coal accounts for 40% of energy use in Tier 2 fashion facilities

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