The council says the move is expected to cut carbon emissions from its waste collection vehicles by 90%.
That equates to around 300 tonnes of carbon saved from the atmosphere over the space of a year.
The authority says the move will not increase its running costs.
Cllr Johnny Thalassites, lead member for net zero at Kensington and Chelsea Council said:
“Achieving net zero is increasingly difficult for councils who are rightly prioritising keeping essential services running for residents. By trialling hydrotreated vegetable oil in place of a polluting fuel like diesel, we are innovating without compromising service. Residents are still getting their bins collected twice a week, and it’s not costing more either – win win.
“A lot of HVO is reclaimed from catering. So next time you’re enjoying Friday night fish and chips, the oil used to fry your meal may well end up fuelling our waste collection vehicles.”
Hydrotreated vegetable oil is made from cooking oils and animal fats that are treated with hydrogen to create fuel.
The way HVO is made means it works in the engines of the existing vehicles, so it can simply replace the previous fuel source without any changes to the vehicles or any adverse effects on their engines.