December 2020

RE.ACT Environmental and economic assessment of post-industrial cotton waste recycling EXECUTIVE SUMMARY

The Egyptian Cotton Project, funded is comparable to the less impactful virgin by the Italian Agency for Development alternatives. The scaled scenario shows and Cooperation, is implemented by the significant improvements in comparison to United Nations Industrial Development the pilot trials due to efficiency increases Organisation, UNIDO, in cooperation with in the recycling processes, while other the Ministry of Trade and Industry and improvements could still be leveraged local and international textile private further, such as the transition to renewable sector stakeholders. energy sources or the blending with virgin fibre with a lower environmental The project aims at advancing the impact embedded. competitiveness and international market presence of the Egyptian cotton value The economic assessment sheds light on chain, highlighting aspects of sustainability, the attractive opportunity that bringing inclusiveness and value addition. In this a recycled cotton yarn value chain to regard, UNIDO has developed a pilot project life at scale in Egypt may present, due in a joint effort with Egyptian and Italian to the partially averted cost from short- industry partners to test quality and market staple cotton fibre imports. Overall, the opportunities for recycled cotton yarns marketability of the yarn is promising in produced from post-industrial denim scraps terms of quality to compete with other from the Egyptian apparel industry. The recycled yarns, and given the surge of the pilot relates to operational trials of textile- demand in Egypt export markets. to-textile recycling by transforming these scraps, which are otherwise considered The highly positive outlook resulting from waste, into spun yarns for weaving and this assessment as well as the quality of knitting new garments. yarns obtained calls for a continuation of this project to evaluate its scaling opportunities Establishing post-industrial cotton recycling as well as the potential incorporation of as a viable and scalable possibility of these activities and technologies in the public reducing cotton-textile waste, as well as funding roadmap for the coming years. to potentially reduce short staple cotton imports in Egypt ,requires a solid fact base regarding the benefits and drawbacks of the process. Therefore, Circle Economy has been commissioned within this project to study the environmental and economic impacts of the recycling pilots as well as its potential for scaling.

The environmental assessment of the regenerated cotton yarn shows clear improvements in comparison to the virgin alternatives it has been compared to through the LCA. This is especially clear

for the water consumption and the CO2 emissions contributing to global warming in the scaled scenario. While the total energy demanded for the scaled scenario of the regenerated blended yarn is lower than for the virgin yarns, the fossil resource use

Garments with recycled woven fabrics by Albini Group. Photo: Alessandro Turra

2 3 -

TABLE OF CONTENTS

2 EXECUTIVE SUMMARY CIRCLE ECONOMY UNIDO

Circle Economy works to accelerate UNIDO is the specialized agency of 6 INTRODUCTION the transition to a circular economy. the United Nations that promotes 1 As an impact organisation, we industrial development for poverty identify opportunities to turn reduction, inclusive globalization and circular economy principles environmental sustainability. 8 MAPPING THE CURRENT EGYPTIAN into practical reality. As of 1 April 2019, 170 States are 2 Members of UNIDO. COTTON VALUE CHAIN With nature as our mentor, we combine practical insights with The mission of the United Nations scalable responses to humanity’s Industrial Development Organization greatest challenges. Our vision is (UNIDO), as described in the Lima 12 CIRCULAR OPPORTUNITIES: economic, social and environmental Declaration adopted at the fifteenth 3 RECYCLING POST-INDUSTRIAL prosperity, without compromising session of the UNIDO General the future of our planet. Conference in 2013, is to promote COTTON WASTE and accelerate inclusive and We work with business, cities sustainable industrial development 13 THE PILOT and governments to identify in Member States. The relevance of opportunities to become more this work as an integrated approach 14 THE SCALED SCENARIO circular. Using our Circle Scan to all three pillars of sustainable methodology, we use a systematic, development is recognized by 15 Environmental assessment science-based approach to the 2030 Agenda for Sustainable analyse current operations around Development and the related 17 Economic assessment key circularity indicators and Sustainable Development Goals then quickly identify strategic (SDGs), which will frame United opportunities based on Nations and country efforts towards circular principles. sustainable development 24 RECOMMENDATIONS in the next ten years. 4 FOR SCALING www.circle-economy.com www.unido.org 28 5 WAY FORWARD

30 ANNEX I: TECHNICAL - LIFE CYCLE ASSESSMENT REPORTING

4 5 1 INTRODUCTION

The Egyptian Cotton Project, funded the amount of Egyptian fibre used by An economic assessment helps provide a by the Italian Agency for Development the industry. Modernising technologies, commercial rationale to the introduction of and Cooperation, is implemented by the such as for ginning and spinning, creating recycling operations in Egypt and sketch out United Nations Industrial Development employment, upskilling workers and how they could benefit the Egyptian cotton Organisation, UNIDO, in cooperation with increasing product exports comprise main value chain at large. In particular, the focus the Ministry of Trade and Industry and priorities for the country.3,4 Additionally, this is placed on three elements that constitute local and international textile private vision is further complemented by ambitions the business case: (1) an investigation sector stakeholders. of the national government of increasing of the different cost drivers across the public green investment;5 as well as two processes; (2) an evaluation of profitability The project aims at advancing the European programmes aimed fostering a in comparison between a pilot scenario, a competitiveness and international market green recovery of the Egyptian economy scaled scenario and the use of virgin fibre presence of the Egyptian cotton value from the Covid-19 crisis through loans for and (3) a broader apprehension of the chain, highlighting aspects of sustainability, green investment in energy, water and market potential of the yarn. inclusiveness and value addition. In this resource efficiency.6 regard, UNIDO has developed a pilot project These results hope to inform decision in a joint effort with Egyptian and Italian Establishing post-industrial cotton recycling making on scaling up the pilot sustainably industry partners to test quality and market as a viable and scalable possibility of moving forward. opportunities for recycled cotton yarns reducing cotton-textile waste, as well as produced from post-industrial denim scraps to potentially reduce short staple cotton from the Egyptian apparel industry. The imports in Egypt ,requires a solid fact base pilot relates to operational trials of textile- regarding the benefits and drawbacks of to-textile recycling by transforming these the process. Therefore, Circle Economy scraps, which are otherwise considered has been commissioned within this project waste, into spun yarns for weaving and to study the environmental and economic knitting new garments. impacts of the recycling pilots as well as its potential for scaling. Cotton is the second most utilised fibre for textiles and apparel, accounting for A life-cycle assessment of the environmental approximately 23% of the global fibres’ impact of the resulting regenerated market share in 2019.1 High quality cotton blended cotton yarn is used to calculate fibre, as well as textiles and garments the contributions to certain impact manufactured from this material, represent categories, thereby enabling comparison a relevant source of industrial output and with alternative virgin cotton yarns. This exports in Egypt. The textiles and clothing study provides insights into the following sector in Egypt contribute to almost 3% of impact categories: its GDP, accounting for 27% of the industrial output and 12% of Egypt’s overall exports.2 CO2 emissions (contributing to Further, the relevance of this sector in the global warming) country is supported by the Government of Egypt’s vision to upgrade the cotton-based textile sector, which aims, amongst several Water consumption priorities, to develop the local spinning and weaving industries further and improve their Energy consumption (contributing vertical integration, while also increasing to cumulative energy demand and fossil resource use)

6 7 MAPPING THE CURRENT EGYPTIAN 21 COTTON VALUE CHAIN

The textiles and clothing sector in cotton products every year16 and exports a growing market demand for sustainable Egypt contribute to almost 3% of its 64% of them, while the remaining products textiles, further highlights the potential of Gross Domestic Product, GDP. One of are consumed locally.17 Although the the Egyptian cotton-textile value chain, its the most relevant sources for this is Egyptian textile and apparel sector is small fibre and products, to largely improve the related to cotton. The sector is also the in comparison to large Asian market players environmental and social sustainability second largest industrial sector after such as China or India, its spinning industry of their production and its resource use agriculture and accounts for 27% of the is the largest in the North African region.18 to stay competitive within the market. industrial output and 12% of Egypt’s Hence, the possibility to make use of overall exports.7 While at the moment much smaller than the currently wasted resources such as post- fibre cultivation stages, the development of industrial cut-off waste generated in RMG The largest portion of the export value value-added activities such as yarn, textile, or home textile factories, estimated at 23 currently comes from early on in the value clothing and home textile manufacturing kilo tonnes per year, to substitute part of 8 chain. In the market year, MY, 2019/2020, represents a strategic priority supported imported short-staple fibre, may present around 67 kilo tonnes, kT, of cotton lint by the Textile and Apparel Vision 2025, itself as an interesting opportunity for have been produced, from a planted area launched in 2015 by the Ministry of Trade the sector to assess both in terms of its 9 of 100,000 hectares of land. These fibres and Industry. This is especially the case in economic opportunities, but also in terms are famous for their premium quality of relation to updating technology and reaching of its potential environmental benefits, to long-staple and extra-long staple, and are sizeable market requirements, such as those support the roadmap of the sector towards most commonly used varieties, Giza 86 from the EU and US markets. This relates as a more sustainable future. and 94, return high yields and comply with well to the rising trend in the international quality properties required by spinners.10 market towards sustainability and circularity. Almost three quarters of this lint (48kT in MY On one hand brands and manufacturers 2019/2020) are exported and the remaining consensus towards sustainability continues is used as input for the local spinning to grow, through industry commitments industry, mainly for home textile products.11 such as the Global Fashion Agenda 2020 Circular Commitments,19 The Fashion This is because Egypt does not only export Pact,20 the UN Fashion Industry Charter for raw cotton fibre, but also hosts a mature Climate Action21 and the Ellen MacArthur local ginning, spinning, weaving, knitting, Foundation Jeans Redesign Guidelines22. This ready-made garment (RMG) and home industry movement is further supported by textiles manufacturing industry. The sector governments around the world that are also encompassed, in 2017, around 2,153 textile starting to roll out circular economy action factories, 657 home textile and 2,255 RMG plans, including the European Green Deal factories, both in state and privately-owned and Circular Economy Action Plan,23 as well 12 companies. Egypt produces around 105 kT as the Chinese National Leading Action Plan of cotton yarns every year and exports 43% on Circular Development.24 of it.13 Most yarns, however, are produced with imported short-staple fibre, used for the In a time of increased pressures and RMG sector.14 Yet, the home textiles sector economic distress driven by the current continues to choose the preferential long- crisis resulting from the COVID-19 pandemic, staple local fibres. Egypt is well positioned as one of the few countries around the world that expects At a later stage in the value chain, around a positive GDP for 2020 and 2021 (~3%).25 137 kT of cotton fabrics are produced every This, coupled with a strong national year and Egypt is exporting approximately roadmap (Egypt’s Vision 2030 Strategy) 15 16% of them in fabric form. The remaining towards economic competitiveness and are used for the local RMG and home textile diversification; the presence of the full industry, which manufactures 132 kT of textile and apparel value chain in Egypt; and

8 9 REGENERATIVE CURRENT MATERIALS (WATER & BIOMASS) COTTON-TEXTILE VALUE CHAIN 1 SEEDS, FARMING & HARVESTING

W AT VIRGIN ER - COTTON - 7 BIOMASS 24 7 kt 5 MATERIALS Mt

OTHER S & MATERIALS ICIDE HERB ERS, 22kt TILIS 9 kt FER S - 1 S CIDE E ESTI 1 kt E P - 3 D ERGY INPUT ORIGINS FOSSIL R EN - FUELS EL FO C FU O

T WA T TE O R N - 4 95 -

M 7 MINERALS t 7

F k INFORMAL O UEL t T FOR E OUTPUT DESTINATION H F NERG UE Y - 144 kt DISPOSAL ER L F OR MA TRAN TE SPORT RIA 2 POST-HARVEST LS - 47% 15 kt PRODUCTION LANDFILL OTHE R MATERIALS - 14 kt 53% INPUTS

MANUFACTURE GINNING USE

LINT IMPORT - 113 TRADING kT

PO ST YAR IN N I P D MP O US SPINNING O ST TR RT IN IA LIN WASTE D L T I US TE MP TR XT OR L MANAGEMENT IA IL T I E N L T W FABRIC EX AS Y T T TE A IL - PRODUCTION E E 1 R W 4 X A k N S t P T P E O E C - 2 T 3 DYEING & X R k W t P T

FINISHING A O S FA -

T B R 4 E YAR R N 8 IMP IC T

O R k T E - - T 89 X 4 P 5 kT O R k

P t T OST 462 M T INDUSTRIAL WASTE-WATER - FA BR IC

EX P O kt R 115 T CONSUMPTION IN 47 kt DOMESTIC MARKET

F ABR IC IM 3 APPAREL & POR T - 41 HOME TEXTILES kt

MANUFACTURING t GLOBAL 5 k Figure 1. Mapping of the current Egyptian cotton value chain. - 8 MARKET TS POR E EX EXTIL APPAREL & T

10 11 CIRCULAR OPPORTUNITIES: Post-industrial cotton comprises cotton cotton input. This mix shows quite a high textile by-products from the manufacturing presence of recycled content compared to 3 RECYCLING POST-INDUSTRIAL stage, such as clipping waste, offcuts, roll industry averages which are closer to the COTTON WASTE ends and remnants. Within post-industrial range of 15-40%.36 However, considering cotton, denim provides a homogeneous that the virgin cotton (Giza 86) fibres were feedstock to be recycled because of its long-staple Egyptian fibres and could fairly consistent indigo blue colour and compensate for the shorter fibres from the Post-industrial cotton waste is becoming 2018 Textile Exchange Corporate Fiber & its fibre composition chiefly composed of recycled input, the performance of a higher more commonly used as an input for Materials Benchmark.28 The establishment cotton. However, denim also poses certain percentage of recycled content wanted to regenerated cotton yarns, although this is of the regenerated content within fashion challenges for mechanical recycling, such be trialled by the partners. The final yarns yet not a process at scale for the industry. and textile products is further driven and as its tight twill weave, or its limitation in were developed in three different colours by Some companies in Egypt already have supported by industry-wide commitments terms of colour palette. Other promising blending the recycled fibre with virgin fibres experience in incorporating cotton scraps to circularity and sustainability such as post-industrial cotton feedstocks are knitted dyed in different colours. The resulting yarn from manufacturing back into yarns.26 the Global Fashion Agenda 2020 Circular cotton garments such as t-shirts or the colours were chosen by a fashion designer/ Others have set up recycling facilities Fashion System Commitment with 86 remnant fabrics from their production. The product developer working for an important with a capacity to recycle 8,000 tonnes of signatories,29 the Denim Alliance with around preference for coloured or undyed fabrics Italian luxury brand and according to fashion cotton waste every year.27 30 participating brands and manufacturers,30 will depend on the final outcome sought and trends. The colours chosen were light blue, and the Jeans Redesign Guidelines with over the colour palette that wants to be achieved. blue and green. There is also a clear market potential 60 participating brands, manufacturers and 37 for the continued development of these mills.31 Moreover preferential benchmarking At a final stage, Albini Group, a manufacturer regenerated yarns, as brands are already tools that assess and score the different 3.1 THE PILOT of woven textiles received packages of each incorporating this content into their clothing colour of the yarn and tested it in the weft of fibres based on their environmental impacts In order to assess the type and quality of and home textile collections. In 2018, the a woven fabric with a 3/1 twill structure. The further support the uptake of recycled yarns and fabrics that could be obtained InterIKEA Group, the H&M Group, Nike warp of this fabric was made from a 60/2 raw cotton. Some of these tools are the HIGG, with recycled post-industrial cotton from Inc., ALDI Gmbh. and Decathlon were the virgin cotton yarn. Placing the recycled yarn or the Textile Exchange Corporate Fiber & the Egyptian apparel industry, a pilot trial brand groups using the largest volumes 32 only on the weft has been intentional in order Materials Benchmark. was conducted. More than 2 tonnes of pure of recycled cotton, coming mostly from to reduce warp breaks due to the weaving cotton denim scraps and cotton/elastane post-industrial sources, according to the tension being too high for the strength of the scraps were collected from an Egyptian jeans recycled yarn. This entails that the final fabric manufacturer, T&C Garments,33 sorted, baled has approximately 25% recycled content, and transported by sea from Egypt to Italy. as the warp is made from virgin yarn. Three In Italy, Marzoli Textile Engineering - Camozzi fabrics with a rustic appearance, of about Group34 together with a textile recycling three metres each, were obtained. The yarns partner teared, opened and carded the can be used for simple weaves and seem scraps into a regenerated cotton sliver. interesting for products that require a rustic The regenerated sliver obtained from the or casual look. Their quality is comparable to recycler was then shipped back to Egypt other fabrics containing mechanically recycled to a spinner, Filmar Nile textile, sister yarns, with some visible irregularities. company of Filmar SpA,35 who then blended Additional tests could be conducted to it with Egyptian long-staple virgin fibres in evaluate the creation and performance of a blowroom, carded once more, and spun fabrics with higher percentages of recycled it into yarn. An estimate of 16% of the total content, which could in turn increase the fibre input was lost as waste during the competitiveness of the fabrics in the market blending, carding and spinning process. for recycled fabrics. During the pilot this fibre waste was not sold, The twisting of the yarns was also tested by however, when processing these materials the spinner, and knitted into garments as a in a larger scale, this current waste stream technical trial. The knitting of the garments could have certain market applications as a was developed through workshops led by an byproduct for nonwovens for geotextiles and Italian fashion designer, Marina Spadafora,38 insulation. in collaboration with young designers from 39 The resulting yarn is a Ne 30/1 compact the Cairo Fashion Design Center. blended cotton yarn. It is composed of 50% recycled content and 50% virgin Egyptian Figure 2. Value chain stages for post-industrial cotton recycling. The full flowchart for the processes involved in the pilot trial can be found in the Technical Annex of this report.

12 13 3.2 THE SCALED those in the pilot scenario. Finally, textile 3.2.1 ENVIRONMENTAL ASSESSMENT certain renewable energies, such as the use waste from the recycling process has been of solar panels which is more present in Italy SCENARIO significantly reduced due to gains in working The environmental impact of the than in Egypt, requires additional water for experience and process efficiencies linked to regenerated cotton yarn has been compared the cleaning of the panels. In order to assess the potential operational scale. In this scaled scenario the to a range of virgin cotton yarns through environmental and economic impact that share of fibre loss is 21%, whilst in the pilot Life Cycle Assessment (LCA). The virgin yarns recycling post-industrial cotton waste WATER CONSUMPTION the textile waste generated added up to 86% are already modelled in Ecoinvent database activities can have in Egypt, the pilot Reference unit: m of the material input. v.3.6,40 and can be found in a range from a setup was scaled up to match a feasible more sustainably cultivated one with lower industrial setup in the country. The key Moreover, an innovative process for impacts to another one with the largest 21.74 Max. virgin cotton underlying assumption in this scenario yarn range refining the recycled carded fibre, with an environmental impacts available. The full is that all operations happen in Egyptian additional vitamins injection was tested LCA reporting with detailed explanations and soil. Assumptions have also been made by the project partner during this project, descriptions can be found in the technical for the scale of the recycling and spinning and is recommended to be added when annex of this report. operations, expecting the recycling scaling these processes. Lastly, in the scaled 8.97 Min. virgin cotton operations to produce around 3 kilo tonnes yarn range scenario, the spinner receives the refined Water consumption, CO2 emissions per year of recycled fibre, that when regenerated fibre from the recycler and contributing to global warming and energy considering a 50% recycled 50% virgin yarn, first blends it in equal amounts with virgin consumption contributing to cumulative could feed around 25,000 spindles. This energy demand and fossil resource use dyed cotton fibre, which is later carded Pilot blended size of shredding unit would also be at the and spun to obtain an untwisted Ne 30/1 are the impact categories chosen for this cotton yarn minimum end of what would be required to blended compact cotton yarn. The spinning assessment. In this section an overview of 8.60 reach economic feasibility. facility has an estimated throughput of 722 the results obtained through this analysis kg/h of fibre input (361 kg virgin and 361 kg as well as their interpretation is presented Scaled blended The recycling operations are proposed for a cotton yarn regenerated), and can serve 25,000 spindles for a functional unit of 1kg of untwisted facility that can take up to 450 kg of material 6.65 in a 10,000 m2 facility. cotton yarn. input per hour. The downtimes in the scaled scenario decrease by 17% in comparison to Figure 4. LCA results of all functional units for the WATER water consumption impact category. For the virgin CONSUMPTION cotton yarns, data is extracted from the Ecoinvent database v.3.6

Water consumption for the regenerated blended yarn is significantly lower than the average water consumption per kg of virgin cotton yarn (Figure 4). This is due to a reduced need for growing new crops for producing fibre. Nevertheless, as the blended yarn is a combination of both virgin and regenerated cotton, the efficiency in the water used to grow and process virgin fibres for that blend is extremely important and influences the total impact of the blended yarn on water consumption. Further, the water consumption of the scaled set-up yarn is lower than that of the pilot due to process efficiency gains and changes in location from Italy to Egypt for some upstream processes. The impacts related to changes in location mainly relate to differences in the electricity grid mix of the countries, as

Figure 3. Post-industrial cotton recycling process with the addition of the refining process in the scaled scenario. The full flowchart can be found in the Technical Annex of this report.

14 15 ability of the final yarn to achieve competitive CO -EQ EMISSIONS ENERGY 2 TOTAL ENERGY DEMAND prices in the market. In this assessment, Reference unit: MJ comparisons were drawn between the pilot The total energy demand in a scaled set up CO2-eq emissions also perform better and scenario, a scaled up scenario highlighting sit below the minimum virgin cotton yarn for the regenerated blended yarn requires also comparative costs of using conventional less energy, beneath the virgin yarn ranges. range for the blended cotton yarn in the 204.30 Max. virgin cotton virgin yarn. The following sections aim to scaled scenario (Figure 5). This is on one The fossil resource use sits in the lower yarn range provide an overview of the results of the hand due to the reduced need for crop end of the virgin alternatives, achieving a analysis. Detailed information on the system growing, as this stage as well as the yarn great reduction in comparison to the pilot definition and life cycle perspective can be dyeing and spinning account for a significant due to efficiency increases in the recycling found in the technical annex. Min. virgin cotton processes (Figure 6). However, shifting all 129.09 portion of global warming contributions yarn range in virgin cotton yarn.41 On the other hand, operations to Egypt currently prevents from 3.2.2.1 COST BREAKDOWN more significant savings, as the electricity and in comparison with the results from While the potential achieving higher prices grid in the country is largely dependent on the pilot, the impact significantly lowers on markets through differentiation is limited fossil fuels. Observing the pilot, its negative due to increased efficiency in the recycling by their competitive, globalised nature, it performance is highly driven by inefficiencies and spinning processes, therefore reduced is worthwhile exploring the potential to and waste generated during the piloting Pilot blended electricity consumption. The reduction of the achieve additional efficiencies in the cost processes, which are understandable and cotton yarn waste produced per kg of fibre input, and structure and thus improving the commercial expected within the scope of a pilot trial that the fibre waste from blending, carding and opportunity associated with recycled yarn. aims to test and achieve a certain quality of spinning processes turned into a byproduct Costs were calculated following a Life yarn with a small volume of material input. with potential to be used in geotextiles and 281.85 Cycle Costing (LCC) approach, meaning insulation for the construction sector further that the same system definition adopted support this improvement. in the Life cycle Assessment is applied with an economic focus. This entails all Scaled blended GLOBAL WARMING FOSSIL RESOURCE SCARCITY cotton yarn costs associated with the procurement, Reference unit: kg CO  eq Reference unit: kg oil eq recycling and spinning operations of the fibre until sold as yarn. In contrast to the 123.08 environmental impact assessment, the 14.82 Max. virgin cotton 3.64 Max. virgin cotton yarn range yarn range LCC approach also considers the building and accessories used as these represent considerable capital expenditures that 8.57 Min. virgin cotton yarn range Figure 6. LCA results of all functional units for the total need to be earned back. However, these 2.00 Min. virgin cotton energy demand and fossil resource scarcity impact considerations only apply to the recycling yarn range categories. For the virgin cotton yarns, data is extracted activities set up in Egypt as no new plant from the Ecoinvent database v.3.6 was set up specifically for the pilot and Egypt already has capacity to accommodate the Pilot blended processes associated with spinning. cotton yarn 3.2.2 ECONOMIC ASSESSMENT Following the LCC approach therefore means Having confirmed the environmental benefits 17.93 that the cost breakdown presented below Pilot blended of using a blended yarn consisting of both includes both the variable costs associated cotton yarn virgin and recycled fibres, the next step in with each unit of production as well as a affirming the initiative’s value to the Egyptian proportional share of the fixed costs which is Scaled blended industry has been to conduct an analysis calculated using their life cycle productivity. cotton yarn 5.44 into its commercial viability. In particular, This section presents a breakdown of 8.22 this involved an assessment of the overall cost drivers per process, followed by a profitability of the operations of a recycled comparative analysis of key cost drivers. yarn value chain along with a deepdive into Scaled blended the profitability’s main constituents: the Figure 5. LCA results of all functional units for the cotton yarn operations’ cost structure as well as the global warming impact category. For the virgin cotton yarns, data is extracted from the Ecoinvent database v.3.6 2.26

16 17 In the pilot scenario, represented in Figure as different test trials. While the costs € 1.00 € 2.00 7, the highest costs are accrued during of buildings and accessories were not the recycling operations. To give a clear considered under the pilot scenario, these TOTAL indication of the share of electricity, labour, are considered minimal. PROCESS equipment and material costs pertained This picture changes significantly under Spinning Shredding to each stage of the value chain, these are 15 % 4 % a scaled scenario of the operations. € 0.11 further distinguished in Figure 7 below. In the Shredding Carding Opening pilot scenario, labour is the most significant Significant efficiencies can be achieved 1 % 2 % and driven by lower costs for labour € 0.05 Carding cost driver contributing almost €7.50, or Opening 2 % 55% of total costs followed by electricity and electricity in Egypt, we can observe significant reductions in variable costs. Refining costs (25%) and raw material costs (15%). € 0.06 2 % Carding The weight of labour and energy costs These lead to an overall reduction in costs down to €2.70 per kg of yarn, stems from the high demand for both of € 0.05 Virgin Fibre Input Refining these during the pilot trials coupled with corresponding to a decrease of more than 74 % comparably higher costs of both labour and 80% in comparison to the pilot scenario. € 1.96 energy in Italy. Relatively high labour and The highest share of costs is accrued due Virgin Fibre Input to the procurement of virgin fibre. energy costs incurred during spinning can CATEGORY € 0.01 be explained by the inclusion of preparation Blending processes falling under spinning as well Cost of Cost of materials electricity € 0.03 Carding 77 % 9 %

€ 0.39 Cost of € 1.00 € 2.00 Spinning equipment 2 %

TOTAL Cost of PROCESS labour LEGEND 12 % Spinning Shredding Cost of buildings & accessories* € 2.12 21 % Shredding 16 % Cost of materials Carding Cost of labour *Costs of buildings & accessories were only 2 % € 4.32 Opening Cost of equipment considered for recycling processes Blending 1 % Cost of electricity (Shredding, Opening, Carding & Refining) € 1.80 Carding Virgin Fibre Opening Input 32 % Figure 8: Comparison of key cost drivers in scaled scenario € 1.96 14 % Carding Virgin Fibre Input 13 %

€ 0.19 Blending To understand where potential for additional help to reduce these even further. Costs for cost-reductions might lie, a breakdown building & accessories were only considered CATEGORY € 0.33 into cost drivers was also performed on for the recycling activities that would need Carding Cost of Cost of the scaled scenario, results are illustrated to be set up in Egypt. When spread over the materials electricity in Figure 8. This figure clearly points to lifetime production capacity of the building & € 2.86 15 % 25 % Spinning two key cost drivers: (1) the cost of virgin accessories are generally only marginal cost fibre input (making up more than 70% of drivers as is exemplified by Figure 8. total costs) and, even though much less impactful, (2) the spinning process. Within As can be observed in the significant cost Cost of Cost of reductions, bringing a recycled cotton yarn labour equipment the spinning process a high demand for 55 % 6 % LEGEND labour and electricity and the included value chain to life in Egypt presents an preparation processes are the source of attractive opportunity due to relatively lower Cost of buildings & accessories* this. Shifting to increasingly more cost- costs for labour and electricity. Cost of materials Cost of labour effective renewable energy sources could Cost of equipment *Costs of buildings & accessories were not Cost of electricity considered in the pilot scenario

Figure 7: Comparison of key cost drivers in pilot scenario

18 19 In order to draw comparisons with the Average total costs for NE30 yarns (Spinning sketch a range within which these fluctuate. The comparably low throughput volumes cost structure of virgin cotton yarns, the Ring) vary significantly between different Given these values and the consistently in the pilot scenario cause significant International Product Cost Comparison countries of origin ranging between €2.40 dominating weight of raw material costs, inefficiencies across operations that also prepared by the International Federation per kg in Pakistan and average total costs from a purely commercial perspective materialise in the cost profile. of Textiles Manufacturers in 2018 was in Egypt exceeding €4.00 per kg.42 These already, there seems to be a clear benefit to Most prominently, these costs relate to consulted. As is illustrated in Figure 10, the average costs are subject to significant replacing the need for costly raw materials production costs in Italy where both energy cost structure of conventional virgin cotton variance on a national level, but illustrate as much as possible. and labour costs far exceed those in yarn is also characterised by a dominating the significant differences in total costs and Egypt. Deducting all costs considered, the cost of raw materials. 3.2.2.2 PROFITABILITY ASSESSMENT pilot operations reach a loss of 6.60€ per kilogram of yarn output. A profitability assessment has been conducted for the overall operations in the In contrast, Figure 11 shows how once € 1.00 € 2.00 € 3.00 pilot scenario as well as in a scaled scenario. scaled up, the production of recycled yarn In this report, attention will be focused has a positive business case. Immense TOTAL on the profitability of the overall process, savings are achieved based on lower costs for energy and labour in the recycling steps LEGEND therefore, assuming that there are no value chain transactions between different of tearing, opening, carding and refining. € 2.76 By far the most significant cost under this Bangladesh Cost of waste partners that may charge additional margin. Cost of labour scenario relates to the procurement of virgin Cost of power Overall profitability was assessed on a per € 2.89 cotton fibres. Overall, the scaled up version Brazil Cost of auxiliary material kilogram basis and calculated by deducting of the operations achieves an estimated Cost of capital all costs associated with the production gross profit of €4,20 which translates to a € 3.38 China Cost of raw materials of the yarn from the expected price that gross margin of 59%. Given that national could be achieved per kg of blended yarn. transport costs as well as existing buildings € 4.12 Egypt This is reflected in the waterfall diagrams in and accessories are not factored into this, figures 10 and 11. Figure 10 represents the the margin will be slightly lower in reality. € 2.60 India profitability considering the parameters of

the pilot scenario as described in section 4 €7.10 €4.40 € 2.76 of the technical annex. Indonesia

€ 3.78 Italy €7.10 €13.70 €2.70

€ 3.17 Korea, Rep.

€ 2.42 Pakistan €0.00

€ 2.77 Price per Total Costs per Profits per Turkey Kg of Yarn Kg of Yarn Kg of Yarn

€ 2.87 €0.00 U.S.A. Figure 11: Profitability per kg of output in scaled scenario

€ 2.59 Vietnam Finally, the price that is assumed here may be subject to market fluctuations or competitive pressures. A break even (on a

Figure 9: Comparison of key cost drivers in production of conventional virgin cotton per-kg level) can be achieved at a price of yarn (Spinning Ring NE30) , Source: International Production Cost Comparison 2018, €2.70 per kg, when assuming stable costs. International Textile Manufacturers Federation -€6.60 The following section investigates what the

Price per Total Costs per Loss per Kg key drivers of these costs are. Kg of Yarn Kg of Yarn of Yarn

Figure 10: Profitability per kg of output in pilot scenario

20 21 3.2.2.3 EVALUATION OF MARKETABILITY high quality shirting as well as from medium price markets all the way to luxury brands. In Lastly, this economic assessment aims to particular, young designers and new labels shed some light on the marketability of the tend to prioritise sustainability in sourcing yarn that would result from the described and aim to leverage this as a differentiating and analysed activities. In this section we factor on markets. reference the main aspects affecting the marketability of the yarn as described in Current estimates from partners suggest the results of the tests conducted by the that prices that can be achieved with the operating partners of the spinning as well as recycled yarn may broadly range from the weaving activities. € 3 up to € 8 per kg on commercial markets. Based on the current cost structure, this The quality is similar to other recycled indicates that, bearing in mind further yarns with lower shares of recycled testing is needed, the production of recycled content. The pilot yielded yarn quality that is yarn can be a profitable opportunity for on par with recycled yarns that are currently Egypt and compete with comparable yarns available on the market. Crucially, though, on the market. these available yarns usually exhibit shares of recycled fibre of 15-40% as opposed to the 50% present in this pilot’s output. Further testing with slightly lower shares of recycled fibre may therefore prove to deliver even higher quality and therefore be applicable to finer weaves, such as shirting. In addition, tests including fibre of higher quality cotton scraps or other, longer staple fibres such as wool or cashmere may further increase the quality of yarn outputs.

The quality is different to cotton yarns made from virgin fibres. In comparison to knitted and woven fabrics that are made exclusively using virgin cotton yarn, the quality of the pilot output exhibits irregularities and a more rustic appearance as is typical for fabrics based on recycled fibres. This relates to technical limitations that are found with any mechanically recycled yarn. With its current quality, as regards orthogonal fabrics, it can be used for simple weave applications such as more casual wear. It can therefore compete with more coarse yarns that are already on the market. Lastly, the blended nature restricts colouring of fabrics to melange tones.

There is growing demand for recycled yarn from the market. As the fashion industry continues to focus on alleviating the environmental issues caused by the sector, demand for recycled content is growing across market participants. This includes recycled yarns suitable for different types of garments ranging from casual wear to

Garments with recycled woven fabrics by Albini Group. Photo: Alessandro Turra

22 23 The loss of this market, hence, would RECOMMENDATIONS also influence the consideration in 4 FOR SCALING terms of environmental impact of the regenerated yarns.

The following recommendations emerge impact. As the share of virgin fibre What if the waste generated in the from the environmental and economic represents in this case 50% of the blend, recycling and spinning processes had assessment of the development of it will still significantly influence the final no economic value? regenerated cotton yarns at scale in environmental impact of the yarn. The LCA results evidence that if Egypt. These recommendations have the textile waste generated during been further reviewed and validated the recycling and spinning of the by discussions with the pilot partners regenerated yarns could not be used as well as a diverse group of Egyptian Contribution of virgin fibre to the as a by-product for diverse industries stakeholders participating in the Egyptian regenerated blends and markets (construction, automotive, Cotton Project. The LCA results highlight that the geotextiles, cosmetics), the impact contribution of the virgin dyed embedded in the regenerated blended 4.1 FOR INDUSTRY fibre to the environmental impacts yarn would be higher. For the four carried by the regenerated blended impact categories assessed in this • Enhance and promote further testing yarn is significantly high. For water LCA (water consumption, global to develop improvements in yarn consumption the virgin fibre carries warming potential, fossil resource and fabric performance, including 97% of the impact, while for CO2- scarcity and total energy demand) aspects of both environmental eq emissions it carries 65% and for there would be a 5-6% increase in the performance and product quality. fossil resource scarcity 52% of the impacts embedded in the regenerated The yarn quality obtained through the environmental impact. blended yarn. pilot is already comparable to other recycled yarns currently available on the market. However, mechanically recycled fibres usually exhibit significant fibre shortening. Therefore, trialing • Partner with chemical industries to different shares of recycled content trial low impact dyeing processes for in the blended yarns may support in regenerated yarns. The dyeing of the finding the best suitable yarn count for virgin cotton fibre used for this scenario different markets and product groups. further worsens the environmental Performance improvements can also be impact of the final yarn. Therefore, tested by trialing different types of post- testing the quality and aesthetics of industrial cotton waste, including scraps yarns using undyed raw virgin cotton or coming from knitted cotton garments, partnering with chemical industries to and different types of material blends test lower impact dyeing processes is with other materials. In order to conduct highly recommended. these trials, develop partnerships with brands and retailers to holistically • Ensure the sustainability of by- design products for circularity, with a products along the cotton value chain. demand-driven approach. It is essential that the market for the byproducts of the cotton fibre value • Ensure virgin cotton fibre used has the chain is sustained, as these byproducts lowest possible environmental impact. provide value to what otherwise would Sourcing the most sustainably grown be considered ‘waste’ to this specific virgin cotton available for the blend, or value chain. All of these goods (main and potentially other types of regenerated by-products) share the environmental fibres, such as viscose from chemically impacts embedded during the operations recycled cotton waste, will have the for the manufacturing of the yarns. best results in terms of environmental

24 25 4.2 FOR GOVERNMENT What if the electricity grid mix in • Foster dialogue among relevant public Egypt was further transitioned to and private partners to assess and renewable energy sources? evaluate existing legislation related to waste handling, and the import and The results of a sensitivity analysis export of waste. Revisions of the end- performed during the LCA show that of-waste criteria to match the current if the operations for recycling and industry developments for materials spinning of the regenerated cotton previously considered waste may further blend were to be supplied by a support the handling of feedstock for renewable energy source (in this case recycling. Moreover, an evaluation of solar), the impacts for fossil resource collecting and sorting models for post- scarcity will be lowered by 44%, as will industrial and eventually post-consumer those for global warming potential by textile waste that can be applicable to 30%. The total energy demand will Egypt will support the development of also be 21% lower in this scenario than the necessary infrastructure to conduct in one fueled by fossil-based energy these recycling activities at scale. sources. On the other hand, specifically for solar energy, water consumption • Raise awareness among industrial increases by 13% mainly due to water partners on the benefit to invest in used for the cleaning of the panels. circularity from raw material to design and production of finished garments. In this way, promoting partnerships with brands and retailers that make massive use of cotton and are committed • Invest in the cotton-textile value to increase their uptake of recycled chain and assess the availability of products is key for the scaling of these “green” public investment in setting activities locally. up recycling infrastructure in Egypt. Ambitious goals are in place to double • Leverage more systemic changes for the share of “green” public investments the whole sector such as transitioning to a total of 30% by the forthcoming to renewable energy sources. There is fiscal year. With the large share of the a great potential in hosting all operations cotton-textile value chain that is publicly within the same region or country ie. owned, there is an immense opportunity Egypt. However, considering long-term to attract funding for further trialing plans for renewable energy sources and scaling up the recycling operations. for (some of) the operations across the Driven by the Ministry of Economic value chain may significantly improve Development and the Ministry of trade the environmental performance of the and Industry, criteria and guidelines for yarns in terms of fossil resource scarcity, “green” investment projects are currently global warming potential and total under development and expected energy demand. The feasibility of the to be available in the near future. implementation of the diverse types of On a global scale, several development renewable energy sources for the specific initiatives are dedicating significant focus Egyptian context needs to be further to the use of solar heat in industrial assessed and understood, and these processes (SHIP) and the development plans could build on existing initiatives of circular textile supply chains in the in manufacturing sectors such as the southern Mediterranean.44, 45 ‘Utilizing Solar Energy for Industrial Process Heat in Egyptian Industries (SHIP)’ project.43

Recycled yarns developed by Filmar Spa.

26 27 5 WAY FORWARD

The environmental assessment of the A strong national roadmap (Egypt’s regenerated cotton yarn shows clear Vision 2030 Strategy) towards economic improvements in comparison to the virgin competitiveness and diversification, coupled alternatives it has been compared to with a good position to attract nearshoring through the LCA. from Asian countries due to the disruption of the global textile value driven by the This is especially clear for the water crisis resulting from the COVID-19 pandemic, consumption and the CO emissions 2 places Egypt in an attractive position to contributing to global warming in the develop its cotton-textile value chain to scaled scenario. While the total energy its full potential. demanded for the scaled scenario of the regenerated blended yarn is lower than Further, the full vertical integration of the for the virgin yarns, the fossil resource use cotton-textile industry and capacity to make is comparable to the less impactful virgin use of currently wasted resources such as alternatives. The scaled scenario shows post-industrial waste generated in RMG significant improvements in comparison to or home textile factories, allows Egypt to the pilot trials due to efficiency increases improve the environmental sustainability of in the recycling processes, while other the sector and raise competitiveness. improvements could still be leveraged further, such as the transition to renewable The highly positive outlook resulting from energy sources or the blending with this assessment calls for a continuation virgin fibre with a lower environmental of this project to evaluate its scaling impact embedded. opportunities as well as the potential incorporation of these activities and The economic assessment sheds light on technologies in the public funding roadmap the attractive opportunity that bringing for the coming years. a recycled cotton yarn value chain to life at scale in Egypt may present, due to the partially averted costs from short-staple cotton fibre imports. An overall reduction in costs is possible for a scaled scenario down to €2.76 per kg of yarn, as well as an estimated gross profit of €4,20 which translates to a gross margin of 59%. Given that national transport costs as well as existing buildings and accessories are not factored into this, the margin will be slightly lower in reality.

Overall, the marketability of the yarn is promising in terms of quality to compete with other recycled yarns, and given the surge of the demand in Egypt export markets. The potential testing of lower shares of recycled content as well as the blending with virgin undyed cotton will assess whether the regenerated yarn developed in this pilot has the potential to outperform other recycled yarns. Recycled knitted design by Marina Spadafora. Photo: Alessandro Turra

28 29 ANNEX ANNEX TECHNICAL - LIFE CYCLE ASSESSMENT REPORTING

1. INTRODUCTION b. Pilot description The pilot has been conducted to assess the a. Context type and quality of yarns and fabrics that could be obtained with the recycled post- The Egyptian Cotton Project, funded by industrial cotton inputs. 2218 kgs of pure the Italian Agency for Development and cotton denim scraps and cotton/elastane Cooperation, is implemented by the scraps were collected from T&C Garments,46 United Nations Industrial Development an Egyptian jeans manufacturer. These were Organisation, UNIDO, in cooperation with sorted, baled and transported by sea from the Ministry of Trade and Industry and Egypt to Italy. Once the scraps arrived at local and international textile private sector the facilities of Marzoli Textile Engineering stakeholders. The project aims at advancing - Camozzi Group,47 they coordinated with a the competitiveness and international textile recycling partner to tear, open and market presence of the Egyptian cotton value card the scraps into a regenerated cotton chain, highlighting aspects of sustainability, sliver. For the purpose of the pilot, this inclusiveness and value addition. In this processing was conducted in Italy. Through regard, UNIDO has developed a pilot project an initial trial, 294 kgs of scraps were used in a joint effort with Egyptian and Italian to create 40 kgs of regenerated cotton industry partners to test quality and market sliver, indicating a throughput efficiency opportunities for recycled cotton yarns of approximately 14%. During the tearing produced from denim scraps from the process, 11% of the total input material was Egyptian apparel industry. lost as waste that could not be valorised. During the opening and carding processes, However, establishing cotton recycling as the remaining 75% of the total initial material a viable and scalable alternative to virgin input remained in the machinery as filtration cotton requires a solid fact base regarding unit waste. Nevertheless, this material was the benefits and drawbacks of the process. sold and repurposed as a by-product for use Therefore, Circle Economy has been in nonwovens (eg. insulation or geotextiles) commissioned to study the environmental as well as hydrophilic cotton (eg. for hygiene and economic impacts of the recycling and cosmetic products such as swabs). pilot as well as its potential for scaling. The pilot relates to operational trials of textile- The regenerated sliver was shipped back to to-textile recycling by transforming denim Egypt to Filmar Nile textile, sister company scraps which are otherwise considered of Filmar SpA, an Italian spinning group with waste, into spun yarns for weaving and operations in both Egypt and Italy.48 The knitting new garments. An in-depth life-cycle regenerated sliver was blended with Egyptian analysis of the environmental impact of the long-staple virgin fibres in a blowroom, recycled cotton yarn was used to calculate carded once more, and spun into yarn. the contributions to the relevant impact The resulting Ne 30/1 compact cotton yarn categories, thereby enabling comparison was a 50% recycled 50% virgin blend. with an alternative virgin cotton yarn. Based on these results, the consortium hopes to inform decision making on scaling up the pilot sustainably going forward.

30 31 This mix shows quite a high presence of c. Life Cycle Assessment (LCA) b. Scope definition The alternatives are: recycled content compared to industry averages which are closer to the range of A life cycle assessment (LCA) quantifies the This attributional LCA will assess the 1. 1 kg of conventionally grown, dyed 15-40%.49 The estimate of another 16% of environmental effects of all the activities associated environmental impact differences cotton yarn, average quality, produced the total fibre input was lost as waste during in the value chain. LCA is generally applied between virgin cotton yarn and blended in India, Bangladesh or Global the blending, carding and spinning process. to products in a specific use context and cotton yarn with regenerated inputs (for averages During the pilot this fibre waste was not sold, is an emerging practice to compare two pilot and scaled set-ups). These systems or more alternatives on their difference are thereby compared for an equivalent • Circular elements: none; linear however, when processing these materials in production system a larger scale, this current waste stream can in environmental performance. A LCA is functional unit. comprehensive, usually time-consuming in have market applications as a byproduct for For the virgin cotton yarn, the • Operations: minimum downtime nonwovens for geotextiles and insulation. data collection and requires a well-defined scope. A LCA study generally is used to transformation of virgin fibre to virgin yarn • Location: India, Bangladesh, Global The final yarns were developed in three identify the highest environmental impact for encompasses the following. The activity averages different colours by blending the recycled a given set of impact categories. starts from opening of bales and the activity • Quality: average fibre with virgin fibres dyed in different ends with spinning and winding the yarn. This study has been performed as a Batch dyeing service, for dyeing the virgin colours. The resulting yarns were light blue, The average quality has been defined as ‘simplified LCA’. This type of study, as defined fibre, has been added to the transformation. blue and green. The comparison for this yarns that are neither premium nor at by the Handbook on Life Cycle Assessment53 assessment is based on single ply yarns. a lower-end, and they are comparable entails “a simple variety of detailed LCA For the blended regenerated cotton yarn, between each other either in yarn count At a final stage, Albini group,50 producer of conducted according to guidelines not in full the transformation of textile scraps and (30/1) or performance. The range of woven textiles, received 0.5 kg packages of compliance with the ISO 1404X standards. fibre to blended yarn encompasses the virgin yarns selected encompass a range each colour of the Ne 30/1 recycled compact LCAs are best applied to very specific following. The activity starts from tearing available within the Ecoinvent Database cotton yarn. They tested the yarn in the weft contexts. In this environmental assessment, the textile scraps and the activity ends with v.3.6 and adhere to the definition above. of a woven fabric with a 3/1 twill structure, substantial amounts of primary data have spinning and winding the yarn. Batch dyeing service, only for dyeing the virgin fibre - not while the warp of this fabric was made from been used for modelling the foreground 2. 1 kg of blended dyed cotton yarn from a 60/2 virgin cotton yarn. Placing the recycled processes, which is highly desirable to the regenerated fibre-, has been added to the transformation. the pilot set-up using regenerated yarn only on the weft was intentional in gain valuable insights. To the best of the cotton from the Egyptian apparel order to reduce warp breaks due to the researchers’ knowledge, no comparable The system boundaries and cut-off criteria manufacturing industry weaving tension being too high for the studies have been conducted before for are applied equally on both systems to • Circular elements: Avoided virgin strength of the recycled yarn. This entailed these specific products in the Egyptian make the study as comparable as possible. cotton fibre production, valuable use that the final fabric had approximately 25% specific context.” For example, the environmental impact for certain byproducts recycled content, as the warp was made of the equipment itself in the virgin fibre- from virgin yarn. 2. GOAL AND SCOPE to-yarn processes are not included, nor • Operations: relatively high downtime Three fabrics with a rustic appearance, of DEFINITION is it included for the blended cotton yarn due to small scale operation about three metres each, were obtained. production, because this mainly refers to • Location: Italy (tearing, opening, The weaver suggested that the yarns can be the same equipment. a. Goal definition carding) and Egypt (blending, carding, used for simple weaves and seem interesting spinning) for products that require a rustic or casual The aim of the study is to provide a 3. FUNCTION, look. Their quality is comparable to other comparative assertion on the basis of an FUNCTIONAL UNIT, • Quality: average, Ne 30/1 fabrics containing mechanically recycled attributional LCA of (1) conventionally yarns, with some visible irregularities. produced dyed virgin cotton yarn, and (2) ALTERNATIVES, 3. 1 kg of blended dyed cotton yarn from Further, additional tests could be conducted blended dyed cotton yarn using regenerated REFERENCE FLOWS the scaled set-up using regenerated to evaluate the creation of fabrics with better virgin yarn from textile scraps in a pilot cotton from the Egyptian apparel performances, which could in turn increase manufacturing industry set-up and (3) doing so in a scaled up set- The function is producing average quality the competitiveness of the fabrics in the up, both using textile scraps from the cotton yarn that is used for textile knitting • Circular elements: Avoided virgin market for recycled fabrics. Egyptian apparel manufacturing industry. and weaving. cotton fibre production, valuable use The outcome of the study can be used by all Additionally, twisted yarns have been used for byproducts involved parties to assess if and/or in which The functional unit is producing 1 kg for the production of knitted garments ways blended regenerated cotton is likely of average quality cotton yarn for textile designed by Italian and Egyptian designers, to be a more sustainable alternative to fully knitting and weaving. selected by the Fashion design center in virgin cotton use. Cairo51 and trained by the fashion designer Marina Spadafora.52

32 33 • Operations: minimum downtime ii. Cut-offs alternative of blended cotton yarn in the scaled-up set up. In the blended cotton • Location: Egypt The following cut-offs are made: pilot scenario, textile waste is shipped • Quality: average, Ne 30/1 • Textile scraps. The upstream burdens from Egypt to Italy and regenerated from the garment manufacturing cotton sliver is shipped back from Italy The reasoning behind the functional unit industry, which produce the textile to Egypt. International transport within (1 kg of cotton yarn) is that existing LCA scraps are not taken into account, in line fibre-to-yarn processing is a deviation studies covering cotton yarn have used with the Ecoinvent cut-off model.55 The from the standard chain, and therefore kilogrammes as a unit. This is evidenced assumption in our model is that these international shipping will be included in in the existing processes modelled in impacts were allocated to the function the system boundary. the Ecoinvent database, as well as in already delivered by the denim during 54 studies such as Bevilacqua et al (2014). its first use cycle. So the impacts until Cotton yarn is an intermediate product, in its this point were fully “owned” by the b. Flowcharts wide majority not reaching end consumers. producers/consumers of the original As its use can differ wildly between denim. The trials constitute an end-of-life diverse products (apparel, home textiles, alternative for the denim scraps, other ALTERNATIVE 1: VIRGIN COTTON YARN PRODUCTION etc), the quantity of kilogrammes for the than its usual final disposal. When we FROM FIBRE TO YARN - MINIMUM TO MAXIMUM functional unit is defined arbitrarily to 1kg cut-off and look only at the alternative RANGE OF IMPACT to enable comparison. trial, it is as if the impacts of the original denim up to that point were allocated 4. INVENTORY ANALYSIS 100% to the first function they had. LOCATION Insofar as recycling is not built into PROCESS the system or guaranteed to a certain GEOGRAPHY a. System boundaries extent, the first user consumes without i. Economy-environment system boundary knowing whether the denim scraps will be recycled or not. Therefore, they are fibre, cotton The stages that are included in the system not allocated any environmental burden boundary are the processes required to All processes in in the model. Within the consistency electricity YARN PRODUCTION, one building - create yarn from only cotton fibre or from check performed, an indication for waste yarn building India, Bangladesh cotton fibre and cotton textile scraps. Since the magnitude of impact carried by COTTON OPENING water or Global this study is looking into environmental BALES, CLEANING, waste oil the denim scraps in a scenario where CARDING, SPINNING impact differences between the alternatives, the recycling is widely built into the AND WINDING­ waste water dyeing all processes that are likely to be the same system is presented. service for each system are out of scope. For BACKGROUND PROCESSES BACKGROUND PROCESSES BACKGROUND example, dyeing processes required for the • Equipment. As mentioned before, the virgin yarns are assumed equal, and hence, environmental impact of equipment and machinery is not taken into account, as applied to the relevant virgin cotton inputs yarn, cotton for each of the alternatives. Similarly, all the existing processes for virgin cotton following steps after the yarn production, fibre-to-yarn do not include this either. such as weaving or apparel manufacturing, • Short distance transport. Any short LEGEND will be very similar processes for both virgin distance national transport is left out as and blended yarns and are therefore not Normal process RESOURCE FLOW Location inputs, since the existing Ecoinvent unit included within the system boundary. The process that covers different steps does comparison emerging from this LCA is then Resource use & not include this either, while it is likely environmental only extrapolable to later stages under the Multifunctional process WASTE FLOW interventions from that the goods must be transported to background process assumption that the virgin yarn is used for the site and within the site. For these the same applications as the blended yarn. virgin cotton fibre processing plants it WT process REFERENCE FLOW System boundary is also usually the case that the yarn manufacturing is situated close to the cotton fibre production sites. The same assumptions are made for the Figure i. Virgin cotton yarn production flow chart.

34 35 ALTERNATIVE 2: BLENDED COTTON YARN WITH ALTERNATIVE 3: BLENDED COTTON YARN WITH REGENERATED INPUTS - PILOT SET-UP REGENERATED INPUTS - SCALED SET-UP

LOCATION LOCATION PROCESS PROCESS GEOGRAPHY GEOGRAPHY

textile scraps textile scraps waste for waste for building incineration building incineration TEARING TEARING Building 1 water waste water water

waste water PROCESSES

Italy electricity BACKGROUND PROCESSES PROCESSES BACKGROUND BACKGROUND electricity BACKGROUND PROCESSES BACKGROUND BACKGROUND transport yarn, cotton

yarn, cotton building OPENING byproduct electricity building Building 1

OPENING PROCESSES

byproduct BACKGROUND electricity Egypt yarn, cotton PROCESSES BACKGROUND BACKGROUND GARMENT MANUFACTURER EGYPT GARMENT MANUFACTURER ‡EGYPTˆ GARMENT MANUFACTURER Building 2 yarn, cotton building Italy CARDING byproduct electricity PROCESSES

building BACKGROUND CARDING byproduct electricity PROCESSES BACKGROUND BACKGROUND garments garments building yarn, cotton REFINING electricity

dyed virgin PROCESSES cotton fibre BACKGROUND yarn, cotton building waste for BLENDING incineration dyed virgin transport cotton fibre PROCESSES PROCESSES BACKGROUND BACKGROUND electricity BACKGROUND building BLENDING byproduct

PROCESSES electricity BACKGROUND BACKGROUND

building Building 3 CARDING waste for electricity incineration Egypt building CARDING byproduct Building 2 PROCESSES PROCESSES electricity BACKGROUND BACKGROUND BACKGROUND BACKGROUND Egypt PROCESSES BACKGROUND BACKGROUND

building building waste water byproduct electricity SPINNING electricity SPINNING water waste water water PROCESSES PROCESSES waste water BACKGROUND BACKGROUND BACKGROUND BACKGROUND PROCESSES

BACKGROUND BACKGROUND transport PROCESSES BACKGROUND BACKGROUND

yarn, cotton yarn, cotton

LEGEND LEGEND

Normal process RESOURCE FLOW Location Normal process RESOURCE FLOW Location

Resource use & Resource use & environmental environmental Multifunctional process WASTE FLOW interventions from Multifunctional process WASTE FLOW interventions from background process background process

WT process REFERENCE FLOW System boundary WT process REFERENCE FLOW System boundary

Figure ii. Regenerated blended cotton yarn pilot production flow chart. Figure iii. Regenerated blended cotton yarn scaled production flow chart.

36 37 c. Data collection 2. The recycling facility is envisioned as a the ReCiPe midpoint (h) as well as for the 5. IMPACT ASSESSMENT 1214 m2 facility, processing 450 kg/h of IPCC characterisation for global warming, The data collection for this study consisted material input. The dimensions of the to allow (future) comparison, but for mainly of two different types of sources: plant are based on assumptions of a sake of this report, these results are not a. Impact categories potential investment in land and building included in the analysis of the results. • Primary data collection from the The inventory results of the environmental of 850,000 euros and investment costs This is because the IPCC characterisation partners involved in the blended interventions are used to calculate the in land and building of 700 euros per does not cover the non-EU countries as cotton yarn pilot quantified contributions to relevant impact square metre. comprehensively as the ReCiPe midpoint categories, thereby enabling comparison of • Data from the Ecoinvent database (h) impact assessment method does. the alternatives. For this study, insights are v.3.6., which consists of a mix of 3. The input material for this scale The IPCC characterisation results for all required on the following: curated primary and secondary data of scenario is readily available in alternatives and scenarios are found in manufacturing facilities in Egypt. section 5.b of this appendix. • Water use Data for the virgin cotton is solely based on 4. Losses during the recycling process • For the use of water in the processes, it • CO emissions (contribution to global the existing Ecoinvent data. Unfortunately, include: 2 is assumed that this does not come from warming) Egyptian cotton yarns are not available in the • 9% waste at tearing a natural source and has been filtered/ existing Ecoinvent dataset. Instead, there are processed before using. Local tap water • Energy use three different unit processes available for • 6% waste at opening, sold as by- is used to represent the water use in There are a variety of different impact virgin cotton yarn: product to be used for non-wovens the processes. assessment methods that can provide these and hydrophilic cotton • Virgin cotton yarn from India • In the pilot set-up, production waste at insights with different underlying models. The following three impact assessment • Virgin cotton yarn from Bangladesh • 6% waste at carding, sold as by- several steps is incinerated. It is assumed product to be used for non-wovens that this incineration process resembles methods are applied to provide useful • Virgin cotton yarn, a global average and hydrophilic cotton municipal incineration, for lack of a insights: process modelling non-hazardous • 0% waste at refining ReCiPe midpoint 2016 (H). This impact Using the datapoint from the three types commercial/industrial waste incineration assessment method has the best global of virgin cotton yarn production, a range The spinning (including preparation for in Ecoinvent 3.6. coverage in terms of measuring effects profile has been created, using the minimum spinning and finishing) is envisioned as a d. Multifunctionality and allocation outside of the EU, while many impact and maximum performances of all types for 10000 m2 facility, processing 360 kg/h of assessment methods are more geared solely each impact category assessed. However, regenerated fibre input. In this scenario • For the pilot set-up, two multifunctional towards the EU. Since the geography of the characterization data from a study by where yarns developed are 50/50% virgin/ foreground processes are identified: different alternatives changes between the Bevilacqua et al. (2014) allow for potential regenerated, this entails the facility EU and non-EU, this is an important aspect Opening and carding: Filtration unit comparison with Egyptian cotton yarns. processes 720 kg/h of fibre input. This facility to take into account. From ReCiPe midpoint waste, or processing waste, is a cotton is expected to serve 25,000 spindles. 2016 (H), the following impact categories The modelled processes for the blended byproduct from these processes at the have been used: cotton pilot set-up is built with primary Losses during the preparation for spinning, recycling stage. The application of the data collection. The scaled set-up for the spinning and finishing include: byproduct can vary from use for non- • Global warming (kg CO2 eq) blended cotton yarn value chain scenario woven textiles for insulation, automotive 3 uses the pilot model as a baseline, but builds • 0.05% waste at blending room; or geotextiles; to use as hydrophilic • Water consumption (m ) assumptions around downtimes, process sold as by-product to be used for cotton for personal care items such • Fossil resource scarcity (kg oil eq) efficiencies and the repurposing of waste non-wovens as cotton pads. Economic allocation is flows into byproducts that would be likely • 11.5% waste at carding, sold as by- then used because the main product Cumulative Energy Demand LHV (MJ). This to occur as a result of scaling up operations, product to be used for non-wovens and the byproducts are both functional, impact assessment method analyses the as well as of setting up the full operation of economic flows. total cumulative (i.e. upstream) energy the processes solely in Egypt. The following • 8% waste at spinning (incl. used for all resource use and processes. assumptions are key to the scaled scenario56: preparation for spinning and • For the scaled set-up, five multifunctional The results provide detailed insight on the winding), sold as by-product to be foreground processes are identified: following six categories, although they will 1. All operations occur in Egypt. The used for non-wovens more often be represented by the sum of local transport between facilities Opening, carding, blending and spinning: these categories, ie. total energy demand, for is disregarded in the modelling, as In terms of environmental impact categories, Equally to the pilot set-up, filtration unit reduced complexity. explained in section 4.a.ii. Cut-offs. several clarifications need to be made: waste, or processing waste, is a cotton byproduct from opening, carding • Non-renewable fossil • The midpoint global warming impact (recycler), blending, carding (spinner) category from the IPCC is used in this and spinning. An economic allocation is • Non-renewable biomass study. The impacts are assessed both for applied for the aforementioned reason. • Non-renewable nuclear

38 39 • Renewable biomass b. Characterization results and discussion

• Renewable water The table below presents the results from the life cycle assessment for the different • Renewable wind, solar, thermal impact categories assessed for all functional IPCC 2013 (IPCC 2013 is the successor of units in scope. In the main report, water the IPCC 2007 method). This will enable consumption, global warming potential, the comparison with blended cotton and resource scarcity and total energy demand Egyptian cotton, using the results from are introduced. Additionally, and for Bevilacqua et al., 2014. The following means of comparison with other studies, category is used for this study: the IPCC Global Warming Potential 100a is added within the results. The detailed • Climate change (GWP 100a) breakdown of the total energy demand for each type of energy source can also be found in the table below.

Minimum Maximum Pilot Scaled IA Impact Reference virgin virgin blended blended method category unit cotton cotton yarn yarn yarn range yarn range Water ReCiPe m3 8.97 21.74 8.60 6.65 consumption Global ReCiPe kg CO eq 8.57 14.82 17.93 8.22 warming 2 IPCC GWP IPCC kg CO eq 8.30 14.55 17.64 8.05 100a 2 Fossil ReCiPe resource kg oil eq 2.00 3.64 5.44 2.26 scarcity Total energy CED MJ 129.09 204.30 281.85 123.08 demand Non CED renewable, MJ 84.16 156.43 227.37 94.72 fossil Non- CED renewable, MJ 0.00 0.02 0.00 0.01 biomass Non- CED renewable, MJ 1.85 8.21 8.76 2.50 nuclear Renewable, CED MJ 38.96 47.28 29.00 22.72 biomass Renewable, CED MJ 1.25 3.73 10.48 2.52 water Renewable, CED wind, solar, MJ 0.34 1.33 6.22 0.61 geothermal

Table 1. Full LCA results of all functional units for the selected impact categories. Garments with recycled woven fabrics by Albini Group. Photo: Alessandro Turra

40 41 WATER ENERGY DEMAND Normalised impact assessment results CONSUMPTION The total energy demand in a scaled 1.00 Water consumption for the regenerated set up for the regenerated blended yarn blended yarn is significantly lower than requires less energy, beneath the virgin the average water consumption per kg of yarn ranges. The fossil resource use sits 0.75 virgin cotton yarn. This is due to a reduced in the lower end of the virgin alternatives, need for growing new crops for producing achieving a great reduction in comparison 0.50 fibre. Nevertheless, as the blended yarn is a to the pilot due to efficiency increases in the

combination of both virgin and regenerated recycling processes. However, shifting all 0.25 cotton, the efficiency in the water used operations to Egypt currently prevents from to grow and process virgin fibres for that more significant savings, as the electricity blend is extremely important and influences grid in the country is largely dependent on 0.00 Fossil resource Global Water Total energy the total impact of the blended yarn on fossil fuels. Observing the pilot, its negative scarcity warming consumption demand water consumption. Further, the water performance is highly driven by inefficiencies consumption of the scaled set-up yarn is and waste generated during the piloting lower than that of the pilot due to process processes, which are understandable and IMPACT CATEGORY efficiency gains and changes in location from expected within the scope of a pilot trial that Italy to Egypt for some upstream processes. aims to test and achieve a certain quality of Pilot impact blended yarn These impacts mainly relate to differences yarn with a small volume of material input. Scaled impact blended yarn in the electricity grid mix of the countries, as Min-max virgin yarn impact Figure 4 shows a representation of the certain renewable energies, such as the use performance of the regenerated blended of solar panels which is more present in Italy Figure 4. Normalised impact assessment results for the comparison between a range of virgin yarns and the pilot and cotton yarn for the pilot and scaled set-ups than in Egypt, requires additional water for scaled scenarios of the regenerated blended compact cotton yarn developed. Normalization in this context means to in comparison to the range of performance the cleaning of the panels. scale a variable to have a value between 0 and 1. of the virgin yarns. This visual representation evidences an improved performance (ie. lower environmental impact) of the blended 6. INTERPRETATION established market demand, while for the CO2-EQ EMISSIONS cotton yarn with regenerated inputs in a textile scraps this is not necessarily the case. scaled scenario for all impact categories a. Consistency check Nevertheless, an estimated calculation CO -eq emissions, in relation to global except for fossil resource scarcity, where it is 2 of the potential environmental burden warming potential, also performs better comparable with virgin yarns with the lowest The consistency check is used to determine that these scraps could carry once there and sits below the minimum virgin cotton impact available for comparison. if the assumptions, data, models and is an established market was performed, yarn range for the blended cotton yarn in methods are consistent across the study utilising existing results from previous LCA the scaled scenario. This is on one hand and informs comparison with other studies conducted for denim jeans. These due to the reduced need for crop growing, previous or future studies. calculations show that the consideration of as this stage accounts for a significant the scraps within this life cycle assessment portion of global warming contributions Firstly, not including the impact of the should not have great influence on the final in virgin cotton yarn.57 On the other hand, production of textile scrap is motivated due result. Firstly, the economic allocation share and in comparison with the results from to this stream currently considered waste of the scraps is defined. While the average the pilot, the impact significantly lowers by the majority of the industry. However, import price of denim jeans to the EU in 2019 due to increased efficiency in the recycling if this stream becomes a byproduct with was 11 euros per unit,58 the price for the and spinning processes, therefore reduced a substantial market, this exclusion needs scraps is 0.03 euros per unit. This means that electricity consumption. The reduction of the to be checked for consistency once again. the scraps would be allocated 0.23% of the waste produced per kg of fibre input, and It can be considered an inconsistency that environmental burden of a pair of jeans. the fibre waste from blending, carding and the upstream burdens of the textile waste spinning processes turned into a byproduct from the garment industry is cut-off, while • For the global warming potential with potential to be used in geotextiles and the byproducts from the cotton opening, category, an indication of 33.4 CO2 eq. Is insulation for the construction sector further spinning, carding get allocated the process’ selected from a previous LCA study on support this improvement. burden on an economic basis. This is due to denim jeans.59 The share of the scraps the aforementioned byproducts having an impact for this category would be 0.069

CO2 eq., which would suggest that the

42 43 consideration of the environmental yarn (e.g. Bevilacqua et al, 2014). For this Contribution results for The blending process introduces dyed impact of the scraps leads to a 0.8% study, it is therefore assumed that the yarns global warming virgin cotton fibre, which increases impacts increase in the full impact of the assessed are from a comparable average across the three assessed impact categories recycled yarn. quality. Finally, There is a difference in data as it carries embedded fossil resource age between the alternative for virgin cotton consumption, water consumption and • In terms of water consumption, an yarn and the alternatives for blended cotton Pilot greenhouse gas emissions from prior 3 indication of 7,63 m is selected from a yarn. The alternative for virgin cotton yarn is stages up to cultivation. This can be easily previous LCA study on denim jeans.60 based on 2015-2019 data (Ecoinvent 3.6) and Scale-up spotted in the barcharts above, as the The share of the scraps impact for this 2005 - 2012 (Bevilacqua et al, 2014), while the warming Global virgin input for the blending process is split 3 category would be 0.017 m which would alternatives for the blended cotton yarn are from the impacts of the blending process suggest that the consideration of the based on recently collected data in 2020. itself. The dyed virgin cotton fibre in this LEGEND environmental impact of the scraps leads assessment was calculated based on the to a 0.3% increase in the full impact of b. Contribution analysis Spinning global average for virgin cotton available in the recycled yarn. The stages (processes) that provide Carding Ecoinvent database (v.3.6.). This highlights Blending (process) • Finally, for fossil resource use, an the highest impact to each category in that if a more sustainably sourced virgin Blending (virgin fibre input) indication of 5,56 kg oil eq. is selected both the pilot and scaled set-ups can be fibre is used, the impacts may be even lower Refining than in this assessment. from a previous LCA study on denim identified through a contribution analysis. Carding 61 jeans. The share of the scraps impact This is performed for three of the impact Opening Additionally, the spinning stage accounts for for this category would be 0.013 kg categories: water consumption, global Shredding more intensive electricity use than the other oil eq., which would suggest that the warming and fossil resource scarcity. stages in recycling, and therefore accounts consideration of the environmental Figure 6. Contribution analysis results for pilot and for a large amount of contributions to the impact of the scraps leads to a 0.6% scaled set-ups for the regenerated blended cotton yarn global warming and fossil resource scarcity increase in the full impact of the recycled Contribution results for water consumption for the global warming impact category. categories. This contribution will be highly yarn. dependent as well on the energy mix of the An inconsistency between the virgin cotton country and the facility where the operations yarn and the regenerated blended cotton are located. yarn is the aggregation of the different Contribution results for fossil resource scarcity c. Sensitivity analysis production steps in the modelled processes. Pilot For the virgin cotton yarn, many different To execute this study, assumptions have

steps are aggregated into one, whereas for Scale-up been made in order to reach a quantified

the blended cotton the individual stages consumption Water impact comparison. These assumptions may at recycler and spinner have been duly influence the result of the study, therefore, split. In theory this should not affect the a sensitivity analysis is conducted on the LEGEND impact assessment results, but does show Pilot scaled set-up: future scenarios with different an inconsistency between the way the Spinning energy sources, locations and use of alternatives are modelled. For the virgin Carding Scale-up byproducts are explored.

cotton the existing processes in Ecoinvent Blending (process) scarcity resource Fossil are used as well as the results from Blending (virgin fibre input) The assumptions that were modified for this Refining sensitivity analysis are the following: Bevilacqua et al. (2014), since modelling LEGEND the virgin fibre-to-yarn in a consistent Carding Opening • Allocation: what would be the way to the blended cotton yarn would Spinning Shredding impacts of the blended cotton yarn at be a time-intensive exercise, with not Carding Blending (process) scale if no economic value was allocated necessarily carrying a substantial impact Blending (virgin fibre input) to any of the textile waste streams (in on the assessment results. Building upon Figure 5. Contribution analysis results for pilot and Refining the study considered byproducts with scaled set-ups for the regenerated blended cotton yarn the previous point; the blended cotton yarn Carding monetary value). for the water consumption impact category. alternatives are modeled with primary data, Opening while the data for the virgin cotton yarn Shredding • Location: what would be the impacts of alternative is provided by Ecoinvent. the blended cotton yarn at scale if the recycling operations were conducted in One of the challenging aspects of Figure 7. Contribution analysis results for pilot and Italy instead of in Egypt. comparing different yarns, is the difference scaled set-ups for the regenerated blended cotton yarn in their quality. Existing studies on the for the fossil resource scarcity impact category. environmental impacts of cotton yarn are done on mass rather than the quality of the

44 45 • Avoided waste: what would be the ALLOCATION Allocation sensitivity analysis Plant location sensitivity analysis impacts of the blended cotton yarn at results (scaled set-up) results (scaled set-up) scale if all textiles scraps used would An economic allocation was chosen for this have otherwise been landfilled. study, because almost all byproducts have 1.00 5.4% 5.5% 0.00% 0.00% a clear role within the industry or other 0.01% • Energy source: what would be the industries (e.g. short fibre cotton waste for 0.75 impacts of the blended cotton yarn at non-wovens or hydrophilic cotton pads). 0.00% scale if the energy used was all solar. This allows the environmental burden to be 0.50 There have also been other assumptions for shared between the main product and its -0.01% data and modelling choices in the LCA that byproducts. The bar chart (Figure 8) shows % of change 0.25 are not subjected to a sensitivity analysis, that, if there were no useful applications for -0.02% for example the size of the recycling and these byproducts, the scaled set-up for the spinning facilities and the volumes they can blended yarn would perform worse for fossil 0.00 -0.03% handle. These assumptions were created and Fossil resource Global Water Total energy resource scarcity, global warming and total scarcity warming consumption demand Fossil resource Global Water Total energy reviewed together with the pilot partners energy demand, and water consumption. scarcity warming consumption demand to ensure their feasibility. All assumptions The pricing of the goods and by-products is IMPACT CATEGORY IMPACT CATEGORY cannot be subjected to a sensitivity analysis very important in environmental accounting in this research due to a limited scope of and the valuable application of the Scaled (no allocation) impact blended yarn time to perform the assessment as well byproducts should be guaranteed. Scaled impact blended yarn Figure 10. Sensitivity analysis results for selected impact categories when modifying plant location in the scaled as a clear objective to investigate the key Min-max virgin yarn impact scenario. environmental impacts and potential savings or losses of the recycled yarns. Allocation sensitivity analysis Figure 9. Normalised sensitivity analysis results results (scaled set-up) comparing virgin and scaled scenarios for selected impact categories when allocating no economic value 5.4% 5.5% 5.7% 5.5% to by-products. Normalization in this context means to Plant location sensitivity analysis 6.0% scale a variable to have a value between 0 and 1. results (scaled set-up)

4.0% 1.00 LOCATION

2.0%

% of change 0.75 The impact assessments both in the scenario fully operational in Egypt, 0.0% as well as the scenario operating recycling 0.50 Fossil resource Global Water Total energy scarcity warming consumption demand in Italy and spinning in Egypt offer very

similar results. Although Italy’s electricity 0.25 IMPACT CATEGORY grid mix contains more renewables than that of Egypt, and this should lower the 0.00 Figure 8. Sensitivity analysis results for selected impact yarn’s impact for most categories, these categories when allocating no economic value to by- Fossil resource Global Water Total energy improvements are offset almost completely scarcity warming consumption demand products in the scaled scenario. due to the Egyptian scenario not including IMPACT CATEGORY any cross-border transportation.

Scaled (no allocation) impact blended yarn Nevertheless, observing the comparison Scaled impact blended yarn between this scenario and virgin yarn Min-max virgin yarn impact ranges (Figure 9) , the results also show that the worsened performance of the yarns, when their byproducts have no economic Figure 11. Normalised sensitivity analysis results allocation, would still sit slightly below the comparing virgin and scaled scenarios for selected impact of the range of virgin cotton yarn. impact categories when modifying plant location. Normalization in this context means to scale a variable to have a value between 0 and 1.

46 47 AVOIDED WASTE Sensitivity analysis results landfilled ENERGY SOURCE Energy source - Sensitivity analysis textile waste (scaled set-up) results for solar energy Moving all textiles scraps, that would have The results for the pilot and scaled set-up

otherwise been landfilled, into a value- 1.00 compared to those when fully powered by 2.00 adding chain to produce blended cotton yarn solar energy are staggering; the electricity would reduce global warming impacts for source has a great impact on the impact 0.75 1.50 the scaled scenario. No effects were found assessment results. When shifting to more for fossil resource scarcity, total cumulative renewable energy sources in operations, energy demand and water consumption. 0.50 the blended cotton yarn will greatly 1.00 outperform the virgin cotton yarn on fossil 0.25 fuel use, global warming and cumulative 0.50 Sensitivity analysis results landfilled energy demand. In this comparison, the textile waste (scaled set-up) 0.00 virgin cotton yarn ranges are calculated on 0.00 current energy sources, with low presence 0.0% -8.3% 0.0% 0.0% Fossil resource Global Water Total energy Fossil resource Global Water Total energy scarcity warming consumption demand scarcity warming consumption demand 0.0% of renewables. This scenario does not take

IMPACT CATEGORY into account the similar effect that shifting IMPACT CATEGORY to renewable energy sources would have for -2.5% the virgin cotton value chain. Scaled (no allocation) impact blended yarn Scaled (no allocation) impact blended yarn

Scaled impact blended yarn Scaled impact blended yarn -5.0% Water consumption will increase for cleaning Min-max virgin yarn impact the panel’s surfaces for optimal efficiency, Min-max virgin yarn impact % of change but will stay well below the levels of the -7.5% virgin cotton yarn. Figure 13. Normalised sensitivity analysis results Figure 15. Normalised sensitivity analysis results comparing virgin and scaled scenarios for selected -10.0% comparing virgin and scaled scenarios for selected impact categories when avoiding textile waste. impact categories when switching to solar energy. Fossil resource Global Water Total energy Normalization in this context means to scale a variable scarcity warming consumption demand Sensitivity analysis results energy source Normalization in this context means to scale a variable to have a value between 0 and 1. to have a value between 0 and 1. (scaled set-up) IMPACT CATEGORY

-43.5% -30.4% 12.8% -20.5% Figure 12. Sensitivity analysis results for selected impact 20.0% categories when avoiding textile waste in the scaled scenario. 0.0%

-20.0% % of change

-40.0%

-60.0%

Fossil resource Global Water Total energy scarcity warming consumption demand

IMPACT CATEGORY

Figure 14. Sensitivity analysis results for selected impact categories when switching to solar energy in the scaled scenario.

48 49 CONCLUSION

The environmental impact of the While the improvement in comparison to regenerated cotton yarn has been the average performance of virgin yarns is a compared to a range of virgin cotton clear outcome of this assessment, there are yarns through Life Cycle Analysis (LCA). several recommendations that could further improve the performance of the regenerated Water consumption, CO emissions 2 blended yarn. contributing to global warming and energy consumption contributing to cumulative energy demand and fossil resource use are the impact categories reported in this

assessment. Water consumption and CO2- eq emissions (global warming potential) for the regenerated blended yarn perform better than the virgin yarn and in the scaled scenario sits below the minimum virgin cotton yarn range. This is due to a reduced need for growing new crops for producing fibre as well as due to increased efficiency in the recycling and spinning processes. Nevertheless, the contribution analysis shows that the presence of virgin cotton fibre in the blended yarn is the main driver for both categories. Therefore, the way the virgin fibres are cultivated and processed for that blend is extremely important and influences the total impact of the blended yarn on water consumption.

The total energy demand in a scaled set up for the regenerated blended yarn requires less energy, well beneath the virgin yarn ranges. The fossil resource use is comparable to the less impactful virgin alternatives due to efficiency increases in the recycling processes. However, shifting all operations to Egypt currently prevents from more significant savings, as the electricity grid in the country is largely dependent on fossil fuels. Through a sensitivity analysis with a shift to renewable energy sources (eg. solar) it is evident that this shift may bring further benefits to this impact category.

Recycled knitted design by Tiziano Guardini. Photo: Alessandro Turra.

50 51 REFERENCES

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52 53 ACKNOWLEDGEMENTS

AUTHORS UNIDO Egypt would like to thank private sector partners for their contribution to the Caspar Von Daniels (Circle Economy) implementation of the pilot and the support to the research activities and data collection. Natalia Papú Carrone (Circle Economy) The partners played an instrumental role in Michelle Steenmeijer (Circle Economy) creating this report.

Jacco Verstraeten-Jochemsen (Circle The partners who made this pilot a Economy) reality:

The life cycle assessment has been reviewed and updated by Carlos Felipe Blanco.

CONTRIBUTORS T&C Garments https://tolbagroup.com/tc-garments/ Piera Francesca Solinas (UNIDO)

Sara Berlese (UNIDO)

DESIGN Marzoli Textile Engineering - Camozzi Alexandru Grigoras (Circle Economy) Group https://en.marzoli.camozzi.com/ Nicolas Raspail (Circle Economy)

COMMUNICATIONS Filmar SpA Melanie Wijnands https://www.filmar.it/en/

PUBLICATION

December 2020 Albini Group https://www.albinigroup.com/en/

Marina Spadafora http://www.marinaspadafora.com/

Cairo Fashion Design Center https://www.facebook.com/fdcegypt/

54 55 December 2020