This paper presents the methods used to establish a wood-fuel supply chain for. coal-fired power plants taking into account wood resources, potential suppliers and financial, economic and environmental constraints. The first step is a quantitative and qualitative evaluation of forest residues around the power plants. At the next stage, the supply chain characteristics are analyzed. Finally, a combination of forest residue sources and supply chains is selected under the constraints of the multiple criteria of the energy producers. In the present case study, the conclusion of the analysis is that an optimal strategy includes three levels: one base level made up of large-scale loggers harvesting softwood from final cuts, one top level made up of medium-scale loggers mainly harvesting hardwoods, and a reserve level made up of small-scale loggers and farmers. Detailed characteristics of these levels are given. (C) 2003 Elsevier Science Ltd. All rights reserved.