An economic linear programming model with a sliding time window was developed to assess designing and scheduling a biomass-fueled combined heat and power system consisting of biomass gasifier, internal combustion engine, heat recovery set, heat-only boiler, producer gas storage and thermal energy storage. A case study was examined for a conceptual utility grid-connected BCHP application in Davis, California under different scenarios. The results show that a 100 kW biomass gasifier and engine combination with energy storage was the most cost effective design based on the assumed energy load profile, utility tariff structure and technical and finical performance of the system components. Engine partial load performance was taken into consideration. Sensitivity analyses demonstrate how the optimal BCHP configuration changes with varying demands and utility tariff rates. (C) 2018 Elsevier Ltd. All rights reserved.