The objective of this work is the estimation of the potential of power and heat co-generation (CHP) from agricultural residues in Greece and particularly in the island of Crete. A biomass model determines the number of biomass-fuelled power installed in a given area based on available biomass from agricultural residues. Also, the developed energy-planning model INVERT is used to determine the strategic analysis of CHP power plant introduction to energy planning in the island of Crete, considering different hypothetical senarios for energy planning in the island from 2004 up to 2020. The viable investments are calculated based on the correlation between the power plant installed capacity and the available quantity of biomass in the area. Also, the basic technical, economical, operational and environmental parameters of both biomass and energy analysis models are given and the results are discussed. (C) 2007 Elsevier Ltd. All rights reserved.