This study aimed to develop an energy-and resource-efficient process for the coproduction of edible mushroom, fermentable sugar and solid biofuel from wood residues. A promising potential was revealed for wood ear fungus (Auricularia auricular-judae), which yielded about 200 g mushroom per kg dry birch based substrate, with concomitant degradation of 76.8 and 85.7% of lignin and xylan, respectively, in the substrate. Substrate pasteurisation by hot-air (85-100 degrees C) was as effective as by energy intensive autoclaving (121 degrees C), resulting comparable mushroom growth and degradation of lignocellulose. The spent mushroom substrate (SMS) contained 28-33% glucan, which upon analytical enzymatic saccharification released around 46% of the potentially-achievable glucose, corresponding to a 2.3-fold enzymatic digestibility compared with that of the raw substrate. The solid leftover generated after enzymatic hydrolysis revealed high thermal energy value and promising combustion characteristics, showing a plausibility to be recycled as solid fuel for self-supporting energy system and space heating. (C) 2021 Elsevier Ltd. All rights reserved.