Finland and Sweden have been forerunners in the development of wood harvesting machinery and methods. In both countries, small- and large-scale supply systems for wood chips have been in operation for several decades. More recently, the production and use of forest chips from logging residues and small diameter trees has been growing rapidly. The European Union (EU) has set ambitious targets for the use of renewable energy to mitigate climate change and to increase domestic energy security and self-sufficiency. The largest unutilised source for renewable energy in the EU is forest biomass. European forests could fulfill one third of the goal set for biomass-based energy production in the EU's Biomass Action Plan. In addition, member countries have started national programmes to promote the use of biomass for energy. As a result, interest in Nordic forest energy technology has been increasing rapidly in other parts of the EU. The Finnish Forest Research Institute and its collaborators have been running a technology transfer project in ten European countries, with the goal of tailoring and adapting Nordic forest technology to local conditions through analysing the applicability, costs and overall competitiveness of selected feedstock supply technologies. This paper summarizes the findings of feasibility studies carried out in Poland and Scotland and gives an overview of the current situation and development trends of forest energy in the European Union. (C) 2011 Elsevier Ltd. All rights reserved.