In this work, a technical, economic and environmental analysis is carried out for the estimation of the optimal option scenario for the Cyprus's future power generation system. A range of power generation technologies integrated with carbon capture and storage (CCS) were examined as candidate options and compared with the business as usual scenario. Based on the input data and the assumptions made, the Simulations indicated that the integrated gasification combined cycle (IGCC) technology with pre-combustion CCS integration is the least cost option for the future expansion of the power generation system. in particular, the results showed that for a natural gas price of 7.9US$/GJ the IGCC technology with pre-combustion CCS integration is the most economical choice, closely followed by the pulverized coal technology with post-combustion CCS integration. The combined cycle technology can, also, be considered as alternative competitive technology, The combined cycle technologies with pre- or post-combustion CCS integration yield more expensive electricity unit cost. In addition, a sensitivity analysis has been also carried out in order to examine the effect of the natural gas price on the optimum planning. For natural gas prices greater than 6.4US$/GJ the least cost option is the use of IGCC technology with CCS integration. It can be concluded that the Cyprus's power generation system can be shifted slowly towards the utilization of CCS technologies in favor of the existing steam power plants in order not only to lower the environmental emissions and fulfilling the recent European Union Energy Package requirements but also to reduce the associated electricity unit cost. (C) 2008 Elsevier Ltd. All rights reserved.