One method of establishing a new society involving low environmental load, a so-called "recycling-based society," is to recycle waste. If waste is incinerated, energy may be produced. However, if waste is to be converted to new raw materials or products, it is likely that energy will have to be provided. The extent of waste recovery affects the energy balance in the recycle process. Energy supply and demand is, hence, a key concept in making a recycling based society a feasible proposition. The main objective of this study was to develop a method of assessing the optimal extent of a recycling based society from the viewpoint of energy balance. The method is as follows. Energy consumption in the recovery process is estimated using the distribution of waste discharge sites and recycling facility locations having the minimum waste transport distance. The energy consumption in the conversion process and the energy supply in the incineration process are estimated using specific data from existing recycle and incineration facilities. The proper extent of recovery is one in which energy demand is equal to energy supply. As an example, we apply the method to the Aichi Prefecture in Japan and propose an effective industrial waste transport system for the region. (c) 2004 Elsevier Ltd. All rights reserved.