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At the Jinfeng gas station along the Shanghai-Hangzhou expressway, more and more truck drivers have been pumping biodiesel instead of regular diesel into their vehicles.

The reason is simple: the biodiesel is cheaper.

What most drivers don’t know is that the B5 biodiesel they have been using are produced from waste cooking oil collected across the city.

In a news conference held by the Shanghai municipal government on Sept 13, officials announced that the city has successfully built a recycling system in which waste cooking oil, or “gutter oil”, are collected before turned into biodiesel that is sold at 40 gas stations.

Yang Jinsong, director of the Shanghai Food and Drug Administration, said an average of 150 metric tons of waste cooking oils are collected at restaurants in the city every day. This year, about 30,000 tons of biodiesel were created from these cooking oils.

The recycling system is the latest response to the food safety scandal in 2011 when local media released a report on how some companies were using discarded cooking oils.

“The practice of recycling gutter oil is on its last legs,” declared Yang at the conference.

The new recycling system uses big data to monitor the process of waste oil collection and transportation. Every restaurant larger than 150 square meters in Shanghai is now required to have an ID card in which the amount of waste oil it turns in to the collector is documented and uploaded to the system every day.

Every collector also has a card that allows authorities to trace where the waste oil is transported to.

All the data is uploaded to a monitoring platform which would alert supervisors when a restaurant experiences a significant drop in the amount of waste oil turned in.

Xu Zhen, general manager of Traceability Technology, the company that helped build the monitoring platform, said, “The system has the addresses of restaurants, the plate number of transport trucks, and the type and time of waste oil collected. By using big data, only a few people are required to oversee the oil disposal practices of thousands of restaurants in Shanghai.”

More than 34,000 food and catering businesses in Shanghai are now registered in the system, Xu added.

The collected waste oils are transported to Zhongqi Environment Technology, a company founded in 2005 that specializes in producing biodiesel from waste cooking oil. The biodiesel is then distributed to Sinopec gas stations in Shanghai.

Zhang Xuewang, chairman of the board at Zhongqi, said that while the company only managed to produce 10,000 tons of waste cooking oil in 2011, it can now generate more than 40,000 tons.

To encourage usage of this new fuel, the municipal government and Sinopec have been dishing out subsidies.

“When we first started supplying this biodiesel to Jinfeng station in January, its sales only accounted for 15 percent of the total. Now, it accounts for 60 percent,” said Lyu Wei, deputy general manager of Sinopec Marketing Shanghai Company.

According to Lyu, 54 million liters of the biodiesel have been consumed across 40 gas stations in the city as of the end of August. The company is now planning to supply the B5 biodiesel to 200 gas stations in the city by the end of the year.