The economics of waste oil recycling in the EU

D. Klenert, P. García-Gutiérrez, D. Tonini, H. Saveyn and R. Marschinski

Journal of Environmental Economics and Policy, 2025, vol. 14, issue 1, 1-22

Abstract: In 2018, 1.6 million tonnes of waste oil were collected in the European Union. About 61% of the waste oil was regenerated – i.e. it was turned into base oil again – and 39% followed energy recovery pathways either in the form of conversion to fuel or via direct incineration. Although the life-cycle literature largely agrees that regeneration outperforms energy recovery in the EU in terms of greenhouse gas emissions and societal costs, policies to boost regeneration and their socio-economic impacts remain underexplored. We fill this gap by discussing policies for managing waste oil flows and by systematically assessing their socio-economic impacts. We analyse different policies that would induce an increase in the regeneration rate of waste oil from the current 61% to either 70% or 85% and assess how the type and magnitude of impacts as well as their distribution across different actors varies, depending on the policy design. The policies lead to a net saving in terms of avoided societal costs and to moderate gains in employment. However, when accounting for estimated administrative costs, these benefits are likely insufficient to justify regulatory intervention.

Date: 2025
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DOI: 10.1080/21606544.2024.2318385

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