Waste and residue lipids, such as used cooking oil, animal fats, acid oils and fatty acid distillates, now supply a large share of the feedstock for biodiesel, hydrotreated vegetable oil (HVO) and sustainable aviation fuel (SAF). They earn more regulatory value than virgin vegetable oils, but they are also more variable, harder to verify and more demanding to handle. This guide explains how to match a feedstock to a conversion route, which specification parameters matter, how the regulatory status of each material is decided, and what to agree before the first delivery.
Why waste and residue feedstocks dominate demand
Three policies drive most of the demand. The EU Renewable Energy Directive, as amended in 2023 (RED III), sets transport targets that reward advanced and waste-based fuels and caps the contribution of fuels made from food and feed crops. ReFuelEU Aviation requires rising minimum shares of SAF at EU airports and excludes crop-based biofuels altogether. The UK's Renewable Transport Fuel Obligation and SAF Mandate follow similar logic. In each case, the feedstock category written on the sustainability documents, not the chemistry, decides how much a litre of fuel is worth to the obligated party.
Waste-based pathways also tend to have lower life-cycle greenhouse-gas (GHG) emissions, because wastes and residues carry no emissions from cultivation. That helps producers meet the minimum GHG savings required by RED and, in countries that run a GHG-intensity obligation, increases the value of each tonne.
Match the feedstock to the conversion route
Biodiesel (FAME). Transesterification with methanol over an alkaline catalyst is cheap and efficient, but it tolerates little free fatty acid (FFA) or water. High-FFA feedstocks need acid esterification or another pretreatment step first. Iodine value and sulphur also matter, because the finished ester must meet EN 14214, which limits iodine value to 120 g I2/100 g and sulphur to 10 mg/kg. Our biodiesel producers page covers the process requirements in more detail.
HVO / renewable diesel. Hydrotreating removes oxygen and saturates double bonds, so FFA and iodine value are less critical. The catalyst, however, is sensitive to phosphorus, metals, chlorine, nitrogen and silicon, which must be removed in pretreatment. See our HVO producers page for the contaminants refiners typically specify.
SAF (HEFA-SPK). Aviation fuel from hydroprocessed esters and fatty acids uses the same chemistry as HVO with more severe cracking and isomerisation. C16 and C18 chains give the best jet-range yield, and documentation carries more weight because aviation schemes restrict eligible feedstocks.
The main waste and residue feedstocks
Used cooking oil (UCO). Oil recovered from frying and food preparation, collected from restaurants and food processors. It is the benchmark waste feedstock, listed in Annex IX Part B of RED. Quality depends on the oils originally used and on how the oil was collected, settled and filtered. Used cooking oil is traded against specifications for FFA, MIU (moisture, impurities and unsaponifiables), iodine value and sulphur, explained in our UCO specification guide.
Animal fats. Rendered fats are classed by risk under the EU animal by-products regulation. Category 1 and 2 fats are listed in Annex IX Part B; category 3 fats are not listed, so they do not benefit from the Annex IX provisions.
Palm oil mill effluent (POME) oil. Oil recovered from the wastewater of palm oil mills. POME is listed in Annex IX Part A, so it can count towards advanced-biofuel targets, which makes its verification especially important.
Acid oils and soapstock. Soapstock is the by-product of neutralising crude vegetable oil with caustic soda; acid oil is soapstock that has been split with sulphuric acid. Both are high in FFA and variable in quality. Their regulatory treatment differs between countries and schemes.
Distillers corn oil (DCO). Oil recovered from the stillage of grain ethanol plants, with moderate FFA and a high iodine value.
Fatty acid distillates (PFAD and PKFAD). By-products of the physical refining of palm and palm kernel oil, with FFA usually above 70%. They are widely used in oleochemicals as well as fuels, and their regulatory treatment as residues or co-products varies.
Our guide to POME, acid oil and soapstock covers how these residues are produced and traded.
Typical feedstock specifications compared
The ranges below are indicative only. They show the order of magnitude buyers usually see; actual contracts and lots vary widely.
- Used cooking oil: FFA typically 2–10%; MIU typically up to 2–3%; iodine value roughly 60–130 g I2/100 g depending on the source oils; sulphur usually low, often specified at a maximum of 20–50 mg/kg.
- Category 1 and 2 animal fats: FFA typically 5–20%; iodine value roughly 40–70; nitrogen, phosphorus and polyethylene need attention for HVO.
- POME oil: FFA often 20–50% or more; MIU typically higher than UCO; iodine value close to palm oil, around 50–55.
- Acid oil: FFA typically 50–80%; total fatty matter usually 90–95% or more; sulphur can be tens to hundreds of mg/kg.
- Distillers corn oil: FFA typically 5–15%; iodine value around 110–125.
- PFAD and PKFAD: FFA typically 70–90%; MIU usually 1–2% or less; iodine value around 45–60 for PFAD and below 30 for PKFAD.
Regulatory status: Annex IX Part A and Part B
Annex IX of RED lists the feedstocks that can count towards the advanced-biofuel sub-target (Part A) or that are waste-based but capped (Part B). Part A includes POME, crude glycerine, tall oil pitch, agricultural and forestry residues and several industrial wastes. Part B covers used cooking oil and category 1 and 2 animal fats. Feedstocks that are not listed, including many acid oils, PFAD and category 3 fats, are not automatically ineligible, but their value depends on national rules. Our explainer on Annex IX Part A vs Part B covers the details.
Documentation and sustainability evidence
For a regulated fuel market, a feedstock without sustainability evidence is worth far less than the same material with it. Expect to review:
- A certificate of analysis for the offered lot, with the test methods used.
- A proof of sustainability (PoS) or equivalent document from a voluntary scheme recognised for your market, stating the feedstock category, country of origin and GHG information.
- For collected wastes, evidence that points of origin such as restaurants and food processors are registered and audited under the scheme.
- Registration of the transaction in the EU's Union Database (UDB) where your supply chain falls within its scope.
Ask for the certificate scope with your quotation, and check that the certificate is valid, that it covers the specific site and material, and that the scheme is recognised in your destination market. Certification under a scheme that covers chemicals, or a scheme for aviation under ICAO's CORSIA, does not automatically transfer to road-transport compliance, and the reverse is also true.
Waste feedstocks command a premium, which creates an incentive to mislabel virgin oil as waste. Buyers reduce that risk by asking for traceability to the point of origin, checking volumes against the collector's or mill's plausible capacity, and testing for indicators such as an unusually low FFA for the stated material.
Sampling, testing and acceptance
Most commercial disputes over residues come from sampling rather than chemistry. Before the first delivery, agree:
- Where and how samples are drawn at loading and at discharge, and how many are retained and for how long.
- The test methods, for example ISO 660 for acid value and FFA, ISO 3961 for iodine value, and Karl Fischer titration for water.
- Which analysis governs acceptance, and which independent laboratory acts as referee.
- How price adjustments or rejection apply when FFA or MIU exceed the contract basis.
Logistics: flexitanks, ISO tanks and bulk
Many waste and residue lipids are solid or semi-solid at ambient temperature. Palm-based UCO, PFAD and animal fats need heating to discharge, so specify heating coils or heating pads and a target discharge temperature, and avoid overheating, which raises FFA and colour.
Flexitanks suit many oils, but ask the flexitank provider to confirm compatibility for acid oils and other corrosive or high-FFA materials. ISO tanks with steam coils offer more control for high-value or difficult cargoes. Larger parcels move by sea, where oils and fats are carried as MARPOL Annex II cargoes, so vessel type and previous-cargo rules apply. Keep lots with different sustainability classifications separate at every transfer.
A buyer's checklist
- Define the conversion route and the pretreatment you can run.
- Set parameter limits and price adjustments for FFA, MIU, iodine value, sulphur and contaminants.
- Confirm the regulatory category your authority accepts for the material.
- Check certificate validity, scope and scheme recognition.
- Agree sampling, test methods, referee laboratory and dispute procedure.
- Confirm heating, packaging and discharge arrangements.
Frequently asked questions
What is the difference between a waste feedstock and a residue?
Under RED, a waste is a substance its holder discards or intends to discard, such as used cooking oil. A residue is not the main product of a process and was not deliberately produced, such as POME or crude glycerine. The distinction affects how a feedstock is certified and valued.
Can one feedstock serve biodiesel, HVO and SAF?
Often yes. Used cooking oil, for example, is used in all three. The pretreatment and the specification limits differ, because biodiesel is sensitive to FFA and water, while HVO and SAF units are sensitive to phosphorus, metals, chlorine and nitrogen.
Which parameters affect price the most?
FFA and MIU are the most common price-adjustment parameters, because they drive yield loss and pretreatment cost. For HVO and SAF buyers, contaminants such as phosphorus, chlorine and polyethylene can also lead to discounts or rejection.
Does certification come with every waste feedstock?
No. Certification belongs to the supply chain, not to the material. Ask for the certificate scope with your quotation and check that it covers the site, the material and your destination market.
Why do some feedstocks need heating in transit?
Saturated fats such as palm-based oils, fatty acid distillates and animal fats solidify at ambient temperature. Heating keeps them pumpable for discharge; excessive or prolonged heating should be avoided because it can raise FFA and darken the oil.