Biomass is the fourth largest energy source in the world and the first in India. Every year, plants store 10 times the present annual consumption of energy. However, most of this energy is used inefficiently due to technological and economic constraints. The study of biomass energy is of particular importance for India in view of the extreme dependence of most rural areas on local energy resources. Also, the high rate of population growth, rising prices of commercial energy carriers, viz. electricity, gas, and petroleum products, suggest that biomass energy consumption will increase. However, biomass energy suffers from problems of accessibility (forests, hydro-electric power), high labour input and less flexibility in use, although they can be processed into many forms. It is about such problems, their identification, the possibilities for solution and the formulation of policies that this study has been written.