Development of biomass projects at optimum size and technology enhances the role that biomass can make in mitigating greenhouse gas. Optimum sized plants can be built when biomass resources are sufficient to meet feedstock demand; examples include wood and forest harvest residues from extensive forests, and grain straw and corn stover from large agricultural regions. The impact of feedstock cost on technology selection is evaluated by comparing the cost of power from the gasification and direct combustion of boreal forest wood chips. Optimum size is a function of plant cost and the distance variable cost (DVC, $ dry tonne(-1) km(-1)) of the biomass fuel; distance fixed costs (DFC, $dry tonne(-1)) such as acquisition, harvesting, loading and unloading do not impact optimum size. At low values of DVC and DFC, as occur with wood chips sourced from the boreal forest, direct combustion has a lower power cost than gasification. At higher values of DVC and DFC, gasification has a lower power cost than direct combustion. This crossover in most economic technology will always arise when a more efficient technology with a higher capital cost per unit of output is compared to a less efficient technology with a lower capital cost per unit of output. In such cases technology selection cannot be separated from an analysis of feedstock cost. (c) 2006 Elsevier Ltd. All rights reserved.