Amending municipal solid waste incineration (MSWI) with carbon capture and utilisation (CCU) can simultaneously lower the climate change impacts of incineration and supply carbon for a range of uses. However, life cycle assessment (LCA) shows that technology choices and the benefits of CCU applied to MSWI depend on the energy system in which the MSWI operates throughout its lifetime, and on the markets for the CCU products. Carbon capture reduces up to 50% of the energy recovery of MSWI. We assessed different energy system scenarios, ranging from fossil- to non-fossil based. Direct utilisation of the captured CO2 is beneficial only on a local basis when substituting fossil-based CO2 (−700 kg CO2-eq/tonne waste), with benefits similar to carbon capture and storage. Hydrogenation of CO2 with the purpose of producing feedstock chemicals or fuels such as methane, methanol, dimethyl ether (DME) and formic acid provides much higher benefits (−2000 kg CO2-eq/tonne waste), but only in non-fossil-based energy systems, due to the dramatically high consumption of electricity (more than 6000 kWh/tonne waste). Use as feedstock chemicals provides more benefits than use as fuels, and CCU solutions focusing on methanol and DME are the most promising technologies. Although built on scarce and early-development data, the analysis highlights current crucial issues, at both the technological and system levels, for the future introduction of CCU in MSWI.