The Promise of Pyrolysis

The European Union’s thirst for renewable fuels is growing. Its Renewable Energy Directive (RED II, soon RED III) sets ever-stricter targets, demanding that a rising share of transport energy comes from sustainable sources. Amid the scramble to meet those goals, a once-niche technology has been quietly moving centre stage: pyrolysis, the thermal decomposition of organic material in the absence of oxygen.

Advocates see it as a neat solution to two thorny problems. First, Europe needs more low-carbon fuels. Second, it is drowning in waste, particularly tyres. Each year, the world discards over a billion of them, most of which end up incinerated, shredded for crumb rubber, or dumped in landfills. Pyrolysis offers an alternative—turning old tyres into pyrolysis oil (which can be refined into advanced biofuels), recovered carbon black, and steel. It is a circular dream: a waste feedstock feeding the green-energy transition.

Fit for purpose?

The EU’s standards are strict. To qualify under RED II, renewable fuels must meet demanding sustainability and greenhouse-gas reduction thresholds. Tyre-derived pyrolysis oil has shown promise. It is chemically similar to fossil feedstocks, can be upgraded into drop-in fuels, and counts as an advanced raw material because it is made from waste. A handful of oil majors and refiners have begun blending it into their processes, seeing a pathway to greener jet fuel or diesel.

Testimonial: India, with its vast tyre mountains, has also begun to deploy pyrolysis at scale, albeit often with less stringent environmental controls than Europe requires.

Yet the journey has been bumpy. Early plants were plagued by technical hiccups, inconsistent product quality, and financing woes. Many pilot projects fizzled out before achieving commercial scale. The main challenge lies in upgrading pyrolysis oil. Fresh from the reactor, it is messy stuff: acidic, unstable and full of impurities. Refining it into something fit for engines requires heavy hydrogenation, expensive catalysts and capital-intensive kit.

Winners and strugglers

Still, progress is visible. In Finland, Neste, Europe’s poster child for renewable fuels, has tested tyre-derived oils alongside other waste-based feedstocks. In Germany, Pryme and Enviro Systems, a Swedish firm with a strategic partnership with Michelin, are building plants to scale. Enviro’s deal allows Michelin to secure carbon black for new tyres—closing the loop in a way that regulators love.

Elsewhere, Poland and Hungary have become hotspots, with several mid-sized plants operating at semi-commercial levels, producing thousands of tonnes of oil annually. India, with its vast tyre mountains, has also begun to deploy pyrolysis at scale, albeit often with less stringent environmental controls than Europe requires.

The laggards are in southern Europe, where projects have struggled with financing and permitting. Investors remain wary of betting on a technology still battling for consistent profitability. A sceptical question continues to haunt the sector: is pyrolysis destined to remain a recycling sideshow, or can it truly underpin Europe’s renewable-fuel ambitions?

The road ahead

The answer may hinge on policy. Brussels’ ever-tighter RED targets create a guaranteed demand for advanced feedstocks. Airlines under pressure to adopt sustainable aviation fuel may emerge as a major market. If tyre-derived oil can be reliably upgraded, pyrolysis may finally move beyond demonstration scale and into the industrial mainstream.

For now, its promise is tantalising but unfinished. Pyrolysis has already proven that it can turn waste into something useful. Whether it can do so at the scale and consistency demanded by the EU’s renewable-fuel machine is the test still to come.