Biomass includes all energy materials that emanate from biological sources - residue of wood processing industries, food industry waste products, or municipal solid waste. Unlike the burning of fossil fuels, combustion of biomass merely recycles the carbon fixed by photosynthesis.

Biomass may be used in a number of ways to produce energy. The most common methods are as follows

Combustion,
Gasification,
Fermentation and
Anaerobic digestion.

The table shows the potential available vis-à-vis the installed capacities for Biomass and Bagasse based co-generation.