This paper analyzes the possibility and the cost of using gas from biomass gasification in the production of electricity and generation of heat using a piston engine in which the power in the supplied biomass is no more than 50 MW. A mathematical model that allows for thermodynamic and economic analysis was designed. The input data regarding the gas generator and the process gas were collected in real experiments on the research installation. Electricity and heat production efficiencies and the electric and heat power of the system were primarily used as indicators of the thermodynamic effectiveness. For the economic analysis, discount methods were adopted that consider the legal and economic environment of such investments. Given the assumptions, the analysis shows that positive economic indicators can characterize the considered systems. The work also included sensitivity analysis of change of the selected characteristic quantities on the evaluation indices. The economic viability of such systems is strongly influenced by many factors, mainly price of fuel and green certificates. When the price of fuel is higher than 9.62 (sic)/GJ or the price of certificates lower than 26.75 (sic)/MWh the NPV (net present value) and NPVR (net present value ratio) indices do not reach positive values for any size of installation. (C) 2014 Elsevier Ltd. All rights reserved.