Selecting the right capacity for a used oil re-refining plant is one of the most critical steps in setting up or expanding operations. A plant that is too large may increase capital costs and remain underutilized, while a smaller plant may not meet market potential or achieve profitable returns.
At Thermopac, we understand that every re-refining project is unique defined by local feedstock realities, demand conditions, and investment goals. With more than 31 plants operating across five continents, we’ve developed a deep understanding of what determines the ideal plant capacity for long-term success.
1. Assess Feedstock Availability
Feedstock defines the capacity, not the other way around. The starting point of any capacity planning exercise is to evaluate the volume and consistency of used oil collection available in your region.
Used oil is collected from diverse sources such as automotive service stations, industrial machinery, and transport fleets. The total recoverable oil and its quality directly influence how much you can process every day.
Key factors to consider include:
- Collection network coverage and the reliability of suppliers
- Transportation and logistics costs, which affect profitability
- Quality variations such as contamination or water content, which impact yield
Thermopac supports clients with pre-project feasibility and collection studies to help determine a practical processing capacity before plant design begins.
2. Evaluate Product Demand
The second parameter is market demand for re-refined base oil. While global awareness of sustainable lubricants is increasing, each market behaves differently depending on local industry activity and acceptance levels.
A demand-driven approach ensures that your plant operates near full capacity, it’s essential to ask these questions:
- What is the current and projected demand for Group I or Group II base oils in your target market?
- Are there existing tie-ups with lubricant blenders or distribution partners?
- Are exports part of your strategy, and what international quality standards apply?
Aligning capacity with demand helps you achieve steady throughput and ensures a faster return on investment.
3. Understand Yield Assumptions
Not all used oils yield the same results. Variations in feedstock type and the technology employed can significantly alter recovery rates.
Typical yield ranges for re-refining are between 65% and 80% base oil recovery. The more efficient the process, the higher your returns.
Key points to consider include:
- Feedstock purity and its impact on processing efficiency
- Losses during evaporation, dehydration, and finishing stages
- Technology choice whether advanced thin-film and wiped-film evaporators can enhance yield and quality
Thermopac’s proprietary integration of thin film evaporator and finishing systems minimizes wastage while maintaining product consistency across varying feedstock.
4. Plan for Scalability with Modular Design
Capacity planning should not be rigid. As your supply network and customer base grow, your plant should be able to grow too.
Traditional large-scale facilities often require expensive redesigns to scale up. In contrast, Thermopac’s modular re-refining systems are designed for seamless expansion. Each module operates as an independent yet integrable unit, allowing you to:
- Start small and expand capacity easily by adding modules
- Upgrade to advanced polishing or hydro-finishing units as market demand increases
- Maintain continuous operations during expansion
This modular philosophy ensures that your investment remains future-ready and adaptable.
5. Balance Capex and Opex
A plant’s economic success depends on how well you balance capital expenditure (Capex) and operational expenditure (Opex). A higher capacity may reduce cost per litre through economies of scale but requires greater upfront investment. Conversely, a smaller setup lowers initial costs but increases operating cost per unit.
To find the optimal balance, evaluate:
- The payback period and return on investment across capacity scenarios
- Energy efficiency and manpower requirements as ongoing operational factors
- Automation level, which can reduce recurring costs and downtime
Thermopac’s turnkey re-refining solutions are engineered to deliver the best of both worlds, optimized Capex through modular plant design and reduced Opex through energy-efficient heat recovery and automation.
Conclusion: Capacity Planning Defines Long-Term Success
Choosing the right re-refining capacity goes beyond numbers. It requires a holistic understanding of your feedstock ecosystem, market potential, yield expectations, and growth strategy.
At Thermopac, we partner with you from concept to commissioning, providing complete technical, economic, and process guidance. Whether you’re entering the re-refining business or scaling your existing plant, our team ensures your investment is sustainable, scalable, and future-proof.