Department of the Environment

About us | Contact us | Publications

Settlements Header ImageSettlements Header ImageSettlements Header Image

Publications archive - Human settlements


Key departmental publications, e.g. annual reports, budget papers and program guidelines are available in our online archive.

Much of the material listed on these archived web pages has been superseded, or served a particular purpose at a particular time. It may contain references to activities or policies that have no current application. Many archived documents may link to web pages that have moved or no longer exist, or may refer to other documents that are no longer available.

Used Oil in Australia

Prepared by Meinhardt Infrastructure & Environment Group
Environment Australia
January 2002


The aim of this chapter is to describe the types of oils and identify those which have been defined by Environment Australia as within the scope of this study. The chapter also discusses recovery of used oil and the Product Stewardship Arrangements established by the Commonwealth Government.

2.1 Types of Oil

Petroleum-based oils can be processed, blended and formulated to produce a wide range of products for a variety of applications. They are principally used as lubricants, hydraulic and transmission fluids, fuels, heat transfer fluids and insulants.

The scope of this project has been defined by Environment Australia to include specific categories of petroleum-based lubricants as per the classifications reported in Australian Petroleum Statistics by the Department of Industry, Science and Resources (DISR). These specific categories are:

Excluded from these specific categories, and the scope of this project, are other types of oils which are not petroleum-based, viz. vegetable oils, cooking oils and food oils.

Oils can range from light, highly mobile liquids to heavy fuel oils with such a low viscosity that their use requires heating. The use of a range of additives can enhance their performance and give rise to properties specifically targeted for their intended application. The exact mixture of the lubricant and additives will vary depending on the base oil used and the desired characteristics of the finished product.

Typical additives may include:

Other substances may enter oil as a result of its use, including carbon and metal filings, as well as contaminants from fuel, water and microbial action.

Different applications of oil will have different residence times and generate used oil of different qualities and levels of contamination. The major applications of oil (and potential sources of used oil) in Australia are:

2.2 Recovery of Used Oil

Petroleum-based oils can cause damage to the environment if spread across land or water; oil slicks reduce or prevent air from reaching organisms beneath the oil, contributing to significant degradation of the ecosystem in that area. Some additives or oil contaminants may also be toxic to living organisms (including humans).

Oil products also incorporate a significant investment of resources in order to provide a substance suitable for its intended use, including refining of a non-renewable natural resource and energy inputs for refining and supply of finished products.

Recovery of used oil can help to minimise these environmental impacts. Contaminants can be removed through a range of regeneration techniques (e.g. de-watering, de-mineralisation) and recycled oil used for applications such as an industrial fuel, diesel extender and lubricant.

The Product Stewardship Arrangements (PSA) established by the Commonwealth Government recognised the importance of recovery of used oil by establishing benefits for recycling. An environmental levy of 5 cents per litre was introduced on imported and domestically produced oils; funds from the levy are paid to recyclers who sell recycled oil products for use. The returned levy is paid according to a sliding scale of benefits in accordance with the degree of environmental benefit. Current benefits are outlined in Table 2.1.

Table 2.1 Recycled Oil Benefits

Category Benefit
Re-refined lubricating, hydraulic & transformer oils 0.50
Other re-refined base oils 0.10
Diesel 0.07
Diesel extender 0.05
High grade industrial burner fuel 0.05
Low grade industrial burner fuel 0.03
Filtered hydraulic or transformer oil Nil

These benefits are administered by the Australian Taxation Office (ATO) in response to figures on oil recycling provided to them by accredited used oil sellers.