Pyrolysis Oil Market By Product Type (Biomass-Derived Pyrolysis Oil, Plastic-Derived Pyrolysis Oil, Hybrid Blends); By Application (Power Generation, Heating, Transportation Fuels, Chemical Feedstock); By End User (Industrial Utilities, Refineries, Chemical Companies, Municipal Waste Management); By Geography, Segment Revenue Estimation, Forecast, 2024–2030

Introduction And Strategic Context

The Global Pyrolysis Oil Market will witness a CAGR of 8.1% , valued at USD 380 million in 2024 , and projected to reach nearly USD 610 million by 2030 , according to Strategic Market Research .

 

Pyrolysis oil, also called bio-oil, is produced when biomass or plastic waste undergoes thermal decomposition in the absence of oxygen. Its importance lies in two major roles. First, it acts as a renewable alternative to fossil fuels. Second, it supports circular economy models by giving new value to waste that would otherwise end up in landfills or incinerators. Between 2024 and 2030, these twin drivers are pushing the market beyond pilot projects and into industrial-scale deployment.

 

The broader macro context is clear. On one side, climate policies are forcing energy and chemical companies to decarbonize. On the other, global plastic waste volumes are climbing, with public pressure mounting on governments to find scalable recycling solutions. Pyrolysis oil offers a way to connect these two challenges. It converts waste into a usable feedstock while reducing dependence on petroleum.

 

Technological progress is also speeding things up. Traditional batch pyrolysis is giving way to continuous reactors that can process more feedstock with higher efficiency. Catalysts are being developed to stabilize the oil and improve yields. Hybrid facilities that combine waste-to-fuel and refining are emerging, making pyrolysis oil more compatible with downstream processes such as co-processing in refineries or blending with marine fuels.

 

Policy is equally influential. The European Union’s Green Deal is driving chemical recycling mandates. In the United States, renewable fuel standards are opening pathways for pyrolysis-derived fuels to qualify for credits. Meanwhile, countries across Asia are under pressure to tackle plastic waste pollution, and pyrolysis is becoming a preferred solution in national waste management strategies. This convergence of regulation and innovation is creating a stronger demand pipeline than ever before.

 

The ecosystem is diverse. Equipment manufacturers are scaling modular pyrolysis units suitable for both industrial zones and municipal setups. Major oil and gas companies are piloting pyrolysis oil co-processing in conventional refineries. Waste management operators are securing long-term feedstock contracts with technology providers. Investors, especially those aligned with green finance principles, are actively funding companies that can deliver both commercial returns and environmental benefits.

 

Carbon accounting adds another layer of strategic relevance. For corporations under pressure to reduce Scope 3 emissions, pyrolysis oil provides a drop-in solution that lowers lifecycle carbon intensity while leveraging existing infrastructure. This practical advantage is one reason the market is moving from experimental status to serious consideration by large players.

 

To be candid, pyrolysis oil used to sit at the margins of renewable energy discussions. Today, the narrative has shifted. With Europe commissioning large-scale chemical recycling plants and Asia-Pacific governments accelerating waste-to-fuel initiatives, the debate is no longer about feasibility but about speed and scalability.

 

Market Segmentation And Forecast Scope

The pyrolysis oil market is segmented across multiple dimensions that reflect both technological advances and commercial applications. These dimensions include product type, application, end user, and regional outlook. Each category highlights how the market is evolving from experimental deployment to industrial adoption during the forecast period from 2024 to 2030.

By Product Type, the market can be divided into bio-oil derived from biomass, bio-oil derived from plastic waste, and hybrid feedstock blends. Biomass-based pyrolysis oil remains the more mature segment, given its use in co-firing and renewable heating applications. However, oil derived from waste plastics is attracting faster growth as countries and corporations push for chemical recycling solutions. This segment is expected to record the highest growth rate, as demand for sustainable alternatives in the plastics value chain accelerates.

 

By Application, pyrolysis oil is used in power generation, heating, transportation fuels, and as a feedstock in the production of chemicals. Power generation currently represents the largest application share, driven by industrial users seeking renewable substitutes for furnace oil. Chemical feedstock applications are emerging rapidly, as polymer producers look to integrate pyrolysis-derived oil into circular production loops. In 2024, power generation accounts for a significant share, but chemical feedstock applications are expected to expand the fastest.

 

By End User, the key categories include industrial utilities, refineries, chemical companies, and municipal waste management entities. Industrial utilities adopt pyrolysis oil as a substitute for heating fuels. Refineries are experimenting with blending pyrolysis oil into existing crude streams to meet renewable fuel targets. Chemical companies, especially those in Europe, are positioning pyrolysis oil as a cornerstone of their circular economy commitments. Municipal waste management entities are also playing an important role by partnering with technology providers to create local waste-to-fuel projects. Among these, chemical companies are expected to emerge as the most strategic adopters during the forecast horizon.
 

Regionally , the market is broken down into North America, Europe, Asia Pacific, and Latin America, Middle East, and Africa. Europe leads adoption due to strong recycling mandates and early industrial partnerships between technology providers and petrochemical giants. North America is experiencing steady growth, supported by renewable fuel credit programs. Asia Pacific is forecast to grow the fastest, propelled by rising waste volumes, policy reforms, and new investment flows in China, India, and Southeast Asia. The Latin America, Middle East, and Africa region is still underpenetrated, though pilot projects are expanding in Brazil and the Gulf states.
 

In Scope , this segmentation captures the transition of pyrolysis oil from a niche technology to a commercially viable solution across industries and regions. While power generation and heating dominate the present landscape, applications in chemical feedstock and transport fuels will drive the next wave of market expansion.

 

Market Trends And Innovation Landscape

The pyrolysis oil market is entering a period of accelerated innovation. What was once an experimental pathway is now being reshaped by advances in technology, regulatory momentum, and new business models that connect waste management with energy and chemicals. Between 2024 and 2030, several defining trends are expected to shape how pyrolysis oil moves from pilot stage to mainstream adoption.

One of the strongest trends is the improvement in process technology. Continuous pyrolysis reactors are replacing batch systems, delivering higher throughput and more consistent oil quality. Research into advanced catalysts is also addressing challenges around stability and oxygen content, making the oil more suitable for upgrading into transport fuels or chemical feedstocks. Some startups are experimenting with modular, containerized pyrolysis units that can be deployed near waste collection sites, cutting logistics costs and enabling decentralized production.

 

Another clear trend is the integration of pyrolysis oil into chemical recycling loops. Global plastic producers and petrochemical companies are partnering with pyrolysis firms to secure long-term feedstock supplies. This is being driven by corporate pledges to use recycled content in plastics and by government mandates, particularly in Europe. In practice, this means pyrolysis oil is no longer viewed only as a low-grade heating fuel but as a potential building block for new polymers.

 

The innovation landscape is also seeing the rise of co-processing strategies. Refineries are blending pyrolysis oil with crude oil in existing refining infrastructure. This allows them to meet renewable fuel quotas without having to redesign entire facilities. Early trials in Europe and Asia suggest this approach could be one of the fastest routes to scale, especially for transport fuel applications.

 

Digital tools are beginning to play a role as well. Process optimization through artificial intelligence and machine learning is helping operators improve yield predictions and monitor plant performance in real time. Life cycle analysis tools are being embedded into plant operations to demonstrate carbon reduction benefits, which is increasingly important for securing green finance and regulatory approvals.

 

From a business model perspective, partnerships are emerging as the dominant mode of growth. Municipalities are teaming up with technology providers to turn waste into revenue streams. Oil majors are investing in pyrolysis startups to secure feedstock for their decarbonization roadmaps. Chemical companies are co-developing upgrading facilities to integrate pyrolysis oil into their existing production chains.

 

One expert view is that pyrolysis oil is evolving from a single-product market into a multi-purpose solution. It can act as a low-cost heating fuel, a renewable transport blendstock , and a chemical feedstock depending on refining depth and local demand structures. This flexibility is attracting attention from different sectors simultaneously, a trend not common in other renewable fuels.

 

The bottom line is that innovation is no longer about proving the concept but about scaling, optimizing, and integrating. The market is moving toward commercially viable pathways that can meet industrial volumes and regulatory standards, positioning pyrolysis oil as a serious contender in the global energy and chemicals transition.

 

Competitive Intelligence And Benchmarking

Competition in the pyrolysis oil market is heating up as the industry shifts from small-scale pilot projects to industrial-scale adoption. The field brings together startups specializing in pyrolysis technology, established waste management firms, chemical producers, and energy majors. While each player approaches the market differently, a common theme is strategic partnerships that combine technical expertise with secure feedstock and downstream integration.

Neste has positioned itself as a leader in renewable fuels and chemicals, with significant investments in pyrolysis-based feedstock integration. The company is collaborating with both technology providers and waste management companies to expand its renewable product portfolio. Its advantage lies in its established refining and distribution networks, which enable rapid market scaling once pyrolysis oil production volumes increase.

 

Plastic Energy , a UK-based company, is among the pioneers of converting end-of-life plastics into pyrolysis oil. It has secured multiple long-term agreements with global chemical companies, ensuring offtake for its products. Its modular plants, already deployed in Europe, serve as benchmarks for others trying to enter the space. The company’s close alignment with chemical recyclers gives it a strong foothold in the growing circular plastics economy.

 

Quantafuel , based in Norway, is another prominent competitor. The company focuses on integrating pyrolysis technology with downstream refining, producing both pyrolysis oil and upgraded outputs. Backed by strategic investors, Quantafuel is building large-scale plants in Europe, aligning itself with strong policy support for chemical recycling. Its main differentiator is its ability to scale quickly through industrial partnerships.

 

Agilyx , headquartered in the United States, operates as both a technology developer and a producer of pyrolysis oil from mixed plastic feedstock. The company has partnered with energy majors to expand capacity and is focusing heavily on intellectual property and process optimization. Agilyx stands out for its focus on chemical recycling and strong emphasis on feedstock flexibility.

 

Enviro Systems , originally known for tire recycling, has expanded into pyrolysis oil production with a focus on recovering valuable carbon black and other co-products. Its strength lies in diversified outputs, which spreads risk and increases profitability. Partnerships with automotive and rubber industries provide a unique positioning compared to firms solely focused on fuels.

 

Beyond these dedicated companies, oil and gas majors such as Shell and TotalEnergies are investing heavily in pilot plants and joint ventures. Their involvement signals confidence in the commercial potential of pyrolysis oil, while their financial strength and infrastructure create barriers to entry for smaller players.

 

Benchmarking shows that startups typically lead in innovation and modular technology design, while large incumbents dominate in scaling, infrastructure, and regulatory influence. Companies that succeed in this market tend to focus on building ecosystems rather than standalone projects. Aligning with municipal waste providers for feedstock, securing offtake agreements with chemical or fuel producers, and proving lifecycle carbon benefits are now the benchmarks of competitiveness.

 

Overall, the competitive landscape is dynamic but not overly fragmented. Instead of hundreds of small players, a handful of well-funded companies are setting the pace, while industrial giants validate the market through co-investments and partnerships. This combination of entrepreneurial agility and corporate muscle is expected to define the path of pyrolysis oil commercialization through 2030.

 

Regional Landscape And Adoption Outlook

The adoption of pyrolysis oil varies significantly across regions, shaped by local waste streams, policy frameworks, and industrial readiness. While the technology is still scaling, some regions are emerging as early leaders, while others are cautiously experimenting with pilot projects.

In Europe , adoption is the most advanced. Strong regulations around chemical recycling, ambitious carbon neutrality targets, and bans on landfilling plastic waste are accelerating demand for pyrolysis oil. Countries such as Germany, the Netherlands, and the UK have become hotspots for projects, often involving partnerships between pyrolysis startups and global chemical producers. The European Union’s Green Deal and mandatory recycled content requirements are central drivers here. Europe is expected to maintain leadership through 2030, supported by early investments in large-scale facilities.

 

North America shows steady but more measured growth. The United States is leveraging renewable fuel standards to support pyrolysis oil as a potential biofuel input, especially for transport and aviation. Several states, including California, are promoting pyrolysis oil through low carbon fuel credit systems. Canada is also advancing pilot projects as part of its circular plastics strategy. While not as aggressive as Europe, North America benefits from strong investment from oil majors and established refining infrastructure that makes co-processing feasible.

 

Asia Pacific is emerging as the fastest-growing regional market. The sheer volume of plastic waste, combined with rapid industrialization, makes pyrolysis oil particularly relevant. China and India are leading in terms of new plant announcements, while Japan and South Korea are investing in advanced refining pathways to integrate pyrolysis oil into petrochemical operations. Southeast Asia, facing growing waste management challenges, is beginning to see interest from both local governments and global investors. Policy support is less uniform than in Europe, but the pressure to address plastic waste is pushing adoption forward.

 

Latin America , The Middle East , And Africa remain underpenetrated but are beginning to show movement. In Brazil, pilot-scale facilities are under development with a focus on municipal waste-to-energy models. The Middle East, particularly the Gulf states, is exploring pyrolysis oil as part of broader diversification strategies away from crude dependence. In Africa, adoption is at a very early stage, with small-scale projects focused on localized waste management rather than industrial-scale chemical recycling.

 

Benchmarking across regions highlights a clear pattern. Europe leads in policy-driven adoption, North America follows with investment-driven models, and Asia Pacific is catching up fast through sheer scale of waste generation and industrial demand. Latin America, the Middle East, and Africa will remain secondary markets but may gain traction as international funding and partnerships expand.

 

The outlook suggests that regional success will depend not only on technology readiness but also on how well stakeholders align around policy, feedstock availability, and downstream offtake. Europe provides the regulatory template, North America brings infrastructure readiness, Asia Pacific delivers volume, and the rest of the world offers future growth opportunities.

 

End-User Dynamics And Use Case

The end-user landscape for pyrolysis oil is diverse, reflecting its multiple applications as a heating fuel, transport blendstock , and chemical feedstock. Different user groups are adopting the product for distinct reasons, and their choices are reshaping how technology providers and producers approach the market.

Industrial Utilities are among the earliest adopters. For manufacturing plants and district heating facilities, pyrolysis oil offers a renewable substitute for furnace oil and heavy fuel oil. These users are focused on reducing operating emissions while maintaining reliable energy output. The value proposition here is straightforward: a liquid fuel that can fit into existing combustion systems with minor adjustments.

 

Refineries represent another critical user group. Co-processing pyrolysis oil with crude allows them to meet renewable fuel mandates without overhauling existing infrastructure. This approach is gaining traction in Europe and North America, where low carbon fuel credit systems create financial incentives. Refineries also see pyrolysis oil as a bridge to diversify feedstocks and gradually integrate more renewable content into their operations.

 

Chemical Companies are emerging as perhaps the most strategic end users. Under pressure to demonstrate circularity, these firms are incorporating pyrolysis oil into their polymer production chains. The oil serves as a recycled raw material that can be transformed back into plastics, closing the loop on single-use products. For these players, the appeal is not only regulatory compliance but also the ability to market products with certified recycled content, a factor that resonates with brand owners and consumers.

 

Municipal Waste Management Organizations are also entering the landscape, often through partnerships. By integrating pyrolysis technology into their waste treatment strategies, municipalities can reduce landfill volumes while generating revenue streams from the oil. Their involvement also helps secure steady feedstock supply, a critical factor in the economics of pyrolysis projects.

 

A notable use case comes from the Netherlands, where a large chemical company partnered with a pyrolysis technology provider and a municipal waste management agency. The project focused on converting mixed plastic waste into pyrolysis oil, which was then upgraded into naphtha-like feedstock for polymer production. Within the first year, the facility achieved stable output, and the chemical company integrated the oil into its plastic production process. The partnership demonstrated how aligning end users across the value chain — municipalities providing waste, technology providers ensuring conversion, and chemical firms creating products — can unlock scalability and profitability.

 

The takeaway is that end-user adoption is not uniform. Industrial users focus on cost and reliability, refineries seek regulatory compliance, chemical companies pursue circularity, and municipalities aim to solve waste challenges. For pyrolysis oil to scale, producers must design flexible offerings that can meet these varied needs while ensuring consistent quality and supply.

 

Recent Developments + Opportunities & Restraints

Recent Developments (Last 2 Years)

• Neste partnered with a European waste management firm in 2023 to secure steady supplies of pyrolysis oil feedstock, aiming to scale co-processing at its refining sites.

• Plastic Energy announced new plant expansions in Spain and France, supported by chemical recycling offtake agreements with global polymer producers.

• Agilyx entered into a collaboration with ExxonMobil in 2023 to advance chemical recycling projects in North America using mixed plastic waste as feedstock.

• Quantafuel launched a large-scale pyrolysis oil facility in Denmark in 2024, positioning itself to meet European Union recycling mandates.

• Shell piloted co-processing of pyrolysis oil at one of its refineries in Asia in 2024, demonstrating compatibility with existing infrastructure.
   

Opportunities

• Rising demand for circular plastics: Chemical producers are under pressure to meet recycled content targets, making pyrolysis oil a valuable input.

• Decentralized energy solutions: Modular pyrolysis units can support local waste-to-fuel initiatives, especially in emerging economies.

• Green financing and carbon credits: Access to sustainability-linked financing is opening up for projects that can prove lifecycle carbon benefits.

 

Restraints

• Feedstock variability: Differences in waste composition can lead to inconsistent oil quality, affecting downstream integration.

• High capital intensity: Large-scale pyrolysis facilities require significant upfront investment, creating barriers for new entrants.

• Policy uncertainty: While Europe is advancing chemical recycling mandates, inconsistent global regulations limit widespread adoption.
   

The reality is that momentum exists, but execution remains uneven. Companies that secure reliable feedstock and prove downstream compatibility will shape the winners in this space.
 

7.1. Report Coverage Table

Report Attribute	Details
Forecast Period	2024 – 2030
Market Size Value in 2024	USD 380 Million
Revenue Forecast in 2030	USD 610 Million
Overall Growth Rate	CAGR of 8.1% (2024 – 2030)
Base Year for Estimation	2024
Historical Data	2019 – 2023
Unit	USD Million, CAGR (2024 – 2030)
Segmentation	By Product Type, Application, End User, Geography
By Product Type	Biomass-Derived Pyrolysis Oil, Plastic-Derived Pyrolysis Oil, Hybrid Blends
By Application	Power Generation, Heating, Transportation Fuels, Chemical Feedstock
By End User	Industrial Utilities, Refineries, Chemical Companies, Municipal Waste Management
By Region	North America, Europe, Asia-Pacific, Latin America, Middle East & Africa
Country Scope	U.S., UK, Germany, France, China, India, Japan, Brazil, GCC Countries, etc.
Market Drivers	- Push for circular economy and chemical recycling - Rising demand for renewable alternatives to fossil fuels - Policy support through carbon credits and recycling mandates
Customization Option	Available upon request