This study evaluated the co-benefits associated with the utilization of logging residues for electricity production in East Texas, USA. The benefits evaluated included the value Of CO2 emissions displaced due to substituting logging residues for coal in power generation, reductions in site preparation costs during forest regeneration, and creation of jobs and income in local communities. Based on the 2004 Forest Inventory Analysis data and a 70% biomass recovery rate, annual recoverable logging residues in East Texas were estimated at 1.3 Mt (dry). These residues, if used for electricity production, would displace about 2.44 Mt Of CO2, valued at some 9MS at the current CO2 price traded at the Chicago Climate Exchange (accounting for about 2% of the stumpage value). Removing logging residues would also save $200-250 ha(-1) in site preparation costs. In addition, input-output modeling revealed that logging residue procurement and electricity generation together would have a stronger ripple effect on employment than on output or value-added, with about 1340 new jobs created and 215MS in value-added generated annually. These results offer new insights into the cost-competitiveness of forest biomass and bioenergy production. (C) 2007 Elsevier Ltd. All rights reserved.