Used oil rules for NSW workshops: what the EPA expects

Every mechanical workshop in NSW makes used oil and every one of them has to get rid of it lawfully. The rules are not complicated. The penalties for breaking them doubled in 2024. This is a plain summary for workshop owners and managers in Sydney. It is general information rather than legal advice and the links at the end go to the EPA pages it is based on.

Used oil is liquid waste

The NSW EPA’s Waste Classification Guidelines define liquid waste as waste that has an angle of repose of less than 5 degrees above horizontal, that becomes free flowing at or below 60 degrees Celsius or when it is transported or that is generally not capable of being picked up by a spade or shovel. Used engine oil meets that definition. It cannot go in the general waste bin and it cannot be tipped on the ground, down a drain or into the sewer.

It is also hazardous. Used motor oil picks up lead, cadmium, chromium, arsenic, dioxins and benzene in service. The Australian Government’s used oil fact sheet states that one litre of oil can contaminate one million litres of water.

Keep it out of the stormwater drain

The EPA’s stormwater guidance for small industry is titled The drain is just for rain and it means exactly that. Water that enters a street or yard drain runs through the stormwater system into local creeks and rivers untreated. Nothing but clean rainwater should enter the stormwater drain on or near your premises.

The guidance asks you to store oils, solvents, fuels and paints in a designated area away from stormwater drains, preferably covered, sealed and bunded. A bund should be large enough to hold the contents of the largest container plus 10 per cent. Check the storage area regularly, clean up leaks promptly and empty rainwater out of bunds so they keep their capacity. The EPA even suggests a 100 millimetre speed hump across the workshop entrance, which turns the whole workshop floor into a bunded area.

Wash bay and floor wash water is not stormwater either. Sydney Water treats contaminated wastewater from mechanical workshops as trade wastewater, which needs its permission and approved pre-treatment before it goes to the sewer.

What water pollution now costs

Polluting waters is an offence under the Protection of the Environment Operations Act 1997. The Environment Protection Legislation Amendment (Stronger Regulation and Penalties) Act 2024 commenced on 3 April 2024 and doubled the maximum penalties for Tier 2 offences, which include pollution of water. The maximums are now $2,000,000 for a corporation and $500,000 for an individual. On the spot fines for water pollution are now $30,000 for a corporation and $15,000 for an individual for a first offence, with higher amounts for a second offence.

A drum tipped over beside a yard drain can be a water pollution offence. The bund and the spill kit are cheaper.

Tracking and the used oil exemption

Under Part 4 of the Protection of the Environment Operations (Waste) Regulation 2014, the transport of the hazardous wastes listed in Schedule 1 must be tracked when they are moved into, within or out of NSW. The EPA’s table of wastes that must be tracked within NSW includes waste mineral oils unfit for their original intended use (code J100) and waste oil and water mixtures and emulsions (code J120).

Used oil collected for recycling is a special case. The EPA’s waste mineral oil page states that waste oil destined for re-use that is transported solely within NSW is exempt from waste tracking requirements under Exemption 2006-E-4. Waste oil transported between NSW and another state or territory must be tracked. In practice a routine pickup from a Sydney workshop to a NSW processor usually falls under that exemption, which is why the collector’s own docket matters. It is the record that shows what left your site, when it left and where it went.

Where tracking does apply, including interstate movements and other trackable workshop wastes such as solvents, the EPA states that the waste producer, their authorised agent if there is one, the transporter and the receiving facility are all responsible for making sure the waste is properly tracked. A consignment authorisation must be issued before trackable waste is moved and a transport certificate goes with each load. Ask your collector how each of your waste streams is handled and keep the paperwork they give you.

Who is allowed to cart it

The EPA states that an environment protection licence is required to transport loads exceeding 200 kilograms of waste oil, under Schedule 1, clause 48 of the Act. A full waste oil tank is well past that threshold. An interstate licence is not valid for transporting waste oil solely within NSW. A licence is also required to store waste mineral oil received from offsite and to treat or process it, with some exemptions. The EPA keeps a public register where you can search for licensed waste transporters and receiving facilities, including by suburb.

At Oilwise every collection comes with compliance documentation and the signed docket records the volume, the driver and the destination. If your auditor or your landlord wants licence details in writing, ask us.

Small quantities are a different story

If you change the oil in your own ute at home, the rules are gentler. NSW Community Recycling Centres take motor oil and other oils from householders free of charge, in containers of up to 20 litres or 20 kilograms per waste type. They are for household quantities only. The EPA states that businesses are not eligible and should contact a waste disposal service directly.

On a Monday morning

Put together, the rules come down to a short list.

• Store used oil in a covered, bunded tank or store away from drains, with the bund sized for the largest container plus 10 per cent.
• Keep water, solvents, fuel and coolant out of the oil tank.
• Keep a spill kit within reach and empty rainwater out of bunds.
• Use a licensed transporter for collections and check them on the EPA public register.
• Keep every docket and transport document with your environmental records.
• Book the collection before the tank is full, not after.

That is the whole job. If you want it handled, call 0408 679 169 or request a collection.