The Finnish Wood Energy Technology Programme is paying increased attention to the small-scale production and use of wood fuels. An important aim is to develop solutions which are economically competitive, reliable and acceptable in terms of emissions for small-scale (usually under 1 MW) wood fuel production, storage, processing, distribution and heat production. Companies RD & D needs are surveyed to foster research and product development activities and to develop national and international business operations. Problems and development needs are studied and companies are encouraged to implement product development projects, which can be carried out by a single company or jointly by company integrates. Product development projects can be the companies own projects or joint projects with other companies in their field. The total budget for 2002-2004 is about EUR 5.2 million, Tekess share amounts to EUR 2.9 million.