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Abstract Promising growing conditions and favorable renewable energy policies make the western U.S. a potentially suitable region for dedicated woody biomass (DWB) plantations for energy generation. To support the regional development of biomass and biofuels markets, the USDA awarded an AFRI grant to the Advanced Hardwood Biofuels (AHB) Northwest project. As part of the AHB project, GreenWood Resources ("GWR") - a globally diversified timberland investment management company with over 20 years of specialized experience in high-yield, intensive plantation management - installed and managed hybrid poplar DWB plantations at four demonstration sites: Clarksburg, CA; Hayden, ID; Jefferson, OR; and Pilchuck, WA. GWR developed a discounted cash flow ("DCF") investment model based on the AHB project results and plantation management experience across this range of growing and market conditions. The model estimates financial returns and tests the sensitivity of returns to changes in key variables. These results inform directions for future research and challenges for commercial production of DWB. Results indicate that current market pricing for forest biomass in the western U.S. - approximately USD 46/BDMT - produces negative financial returns from DWB plantation investment on all four sites. To produce positive returns at all four sites requires biomass assumptions that are well above the current market (USD 121/BDMT). With this price assumption, plantation investment returns average 8.62% in real, inflation-adjusted terms across all sites, but this biomass price level may make conversion into transportation fuels uneconomic under current fuel prices and policies. Financial returns to DWB investments are most sensitive to changes in price, yield, and land costs. Given current economic conditions and plantation technology, the development of a large-scale DWB plantation base in the western U.S. is unlikely to attract private sector capital without some combination of a material increase in the biomass price, strong policy support, or a dramatic improvement in plantation yields. Highlights • Current pricing for biomass in western U.S. produces negative financial returns. • Biomass investments are unlikely to attract private-sector capital. • Returns are most sensitive to assumptions related to prices, yields, and land costs. • Increase in price or dramatic improvement in yields may change the present situation. [ABSTRACT FROM AUTHOR]