Sustainability Economics and Circular Economy in Textiles

Sustainability economics in textiles quantifies the financial costs, investment requirements, and business model transformations required to transition the global textile industry from linear take-make-dispose patterns to circular, low-carbon, and socially equitable systems — analysing the economic viability of sustainable materials, circular business models, carbon pricing impacts, and regulatory compliance costs. The fashion industry generates 4% of global CO₂ emissions (2.1 billion tonnes CO₂e annually, McKinsey 2020), consumes 93 billion cubic metres of water annually, and produces 92 million tonnes of textile waste — creating regulatory and consumer-driven economic pressure for decarbonisation. EU Ecodesign Regulation for Sustainable Products (ESPR, 2024): mandatory recycled content minimums, durability requirements, digital product passport (DPP), and textile-specific ecodesign requirements effective 2027 — compliance cost estimated €2–5/garment additional for EU-market textile products. Sustainable material price premiums: organic cotton $0.30–0.60/kg premium over conventional (5–8% premium); recycled polyester rPET $0.20–0.40/kg premium (8–15%); lyocell/TENCEL $1.50–3.00/kg premium over viscose (40–80%); recycled nylon (Econyl) $1.00–2.00/kg premium (25–50%). Carbon pricing impact: EU ETS carbon price $60–90/tonne CO₂ (2023–24): dyehouse energy-intensive carbon cost $0.08–0.15/kg fabric at current emission intensity; potential $0.25–0.40/kg at 2030 target carbon price $120/tonne with EU Carbon Border Adjustment Mechanism (CBAM) extending carbon cost to textile imports. Circular economy revenue models: rental/subscription ($150–600 annual subscription per customer, Rent the Runway 150,000 active subscribers); resale ($100 billion global secondhand market 2023 growing 15% annually, ThredUp); product-as-a-service ($0.10–0.30 per use per garment versus $15–25 per garment retail).