Coffee fuels millions of people's mornings, but like other fuels it also comes with its own unique environmental issues. Coffee is one of the globe's largest agricultural commodities, with about 8bn kilograms (more than 16bn lbs) grown annually worldwide. That's a lot of coffee – and a lot of leftover coffee grounds, most of which ends up in landfills or, in a best-case scenario, as a soil conditioner in someone's garden.

Many people seem to like the idea of turning something they throw out daily into a useful commodity. Companies such as Starbucks and Nestle, for example, are already putting used coffee grounds to work, while researchers believe that oil from coffee grounds could end up contributing tens of millions of liters of biodiesel to the global fuel supply.

Detergents, bioplastics and energy

Starbucks, which purchases nearly 400m pounds of coffee annually, is working to convert the grounds – along with bakery food waste – into laundry detergents, bioplastics and other products.

And food giant Nestlé, which has been incinerating coffee for energy for decades, is now also using it as a heat source to cook food products at 22 of its 28 coffee factories.

The idea of using coffee for energy beyond the morning buzz was "driven by the insight that coffee grounds have a fairly high calorific value", says Claus Conzelmann, vice-president for safety, health and environmental sustainability at Nestlé. "In fact their fuel value is even slightly better than wood."

Coffee grounds fulfill 100% of the "actual energy needs" at two of the company's newest coffee factories, which opened this year in Vietnam and China, he says.

The company's reuse of coffee should help the company reach its recently announced goal of zero waste at its 150 European factories by 2020. Incineration has kept some 800,000 tons of coffee grounds out of landfills each year, and also has helped Nestlé halve its carbon emissions per ton of product – and reduce its absolute energy usage by approximately 5% as production has grown more than 60%.

Caffeinated biodiesel

Meanwhile, a trio of scientists at the University of Cincinnati has been studying coffee grounds as a potential feedstock for biodiesel. The researchers found that used coffee grounds – which they collected from an on-campus Starbucks store – are 11% to 20% oil, by weight – roughly the same amount as palm oil, soybean oil and some other biodiesel feedstocks.

Biodiesel made from used coffee grounds would also help reduce waste – and potentially could help ease concerns about biofuels competing with the food supply. And coffee grounds are both plentiful and widely available, as well as "so cheap they're almost free" says Mingming Lu, an associate professor of environmental engineering at the University of Cincinnati involved in the research.

But turning coffee into biodiesel presents some additional challenges compared to the other feedstocks.

For one thing, the oil in coffee grounds is solid, not liquid. "The other oils, they are oils," she says. "The 'oil' we're extracting from … the coffee grounds, it might not be in oil form yet, since they are all solids, they are not liquid yet. But through the extractions, we are able to get this oil as well as convert it. So it becomes what we call a biodiesel precursor."

Additional steps to extract and convert coffee oils into biofuel could result in higher cost, although Lu hopes the low cost of the grounds could offset production costs.

Preliminary results from the research also found that the oil extracted from the coffee grounds also meets the ASTM International D6751 standards for biodiesel fuel blends, which means it could be used for most biodiesel applications. It also has the potential to be cleaner-burning, according to the results.

Java-based air and water filters

Along with extracting oil from the grounds, the group also studied the possibility of converting the coffee grounds into activated carbon, which is used to filter and remove pollutants from air and water, as well as burning the leftover biomass as an alternative energy source, Lu says.

Students at her university's business school are writing business cases, attending competitions and promoting the commercial potential of coffee grounds in the hopes of getting a patent and eventually creating an industry, she adds.

"When I talk to people about this idea, most people get excited to be able to use the waste coffee grounds, instead of throwing it away," she says, "to find a good use for it. So that's motivating enough for us to continue this research."