The purpose of this work was to assess technical and economical possibilities to construct heat production plants using biofuel in Kaunas district. Legal business environment of the independent heat producer was examined, and optimal power of heating facilities was selected from a technical and economic point of view, the preliminary location for boiler and its connection to the district heating network was provided for in the feasibility study. Operating costs of heat production, investment in the project, estimates of financial flows, risk analysis, economic payback were provided in the business plan. Recommendations for the organization structure of heat production activities were developed and the implementation plan of the project was provided.