The EU27 annually generates 90 Mt of food waste, and approximately 40 % of this waste is generated during manufacturing. The food processing industry needs to develop improved and sustainable solutions for waste valorisation and re-use. The project DRALOD addresses this issue since it aims at design, integration and assessment of the performance of a heat recovery system in connection with an innovative low-temperature air drying unit where high moisture food waste is dewatered and sold as a by-product with preserved nutritional ingredients. The air used for drying is preheated using solar heat and a biomass boiler, and in this project the potential benefits of integration of a heat recovery system have been investigated. Due to the impurities available in the humid exhaust air from the dryer, the heat recovery is designed with two principal systems; a wet scrubber condensation system and a heat pump system. Simulations using hourly meteorological data from Madrid have been made for the total system with heat recovery, and the generated results have been used as inputs in a techno-economic analysis in order to assess the integration of the heat recovery and how sensitive different economic parameters and assumptions are for the results. It can be concluded from the assessment that the prices of electricity and biofuel will have a high impact on the economic performance and design. For the integration of the heat recovery system to be economically justifiable it is estimated, given assumptions made in this analysis, that the electricity cost needs to be less than 5 times higher than the biofuel cost.