About 25 million tons of straw are produced annually in Poland. For many decades straw was used mainly for animal production purposes, as fodder or a bedding material. In periods of lower yields, as it happened in the years 1977-1980, an actual deficit of straw was observed. The conducted research proved that since 1983 the yields of straw began to exceed the demand resulting from agricultural production. In the years 1983-1990 an average yearly surplus in relation to its agricultural utilization reached 5 354 thou. tons, whereas in 1995-2001 it was already 10 881 thou. tons. That calculation includes also a certain demand for ploughing up of straw, for maintaining a well-balanced amount of organic matter in soil. The growing excessive amounts of straw induced the search for a more efficient way for its utilization. One of such possibilities was the utilization of straw for power generation. Its calorific effect amounted from 14.3 to 15.2 MJ kg-1, because 1.5 ton of straw makes for an energy equivalent of 1 ton of coal. Its successful introductions proved that there are technical possibilities for utilization of straw as a fuel, not only for heating flats and livestock buildings, but also in communal heating plants. The aim of the research was to define the economic and ecological effects of thermal energy production from straw, in comparison to conventional fuels such as coal and oil. The research was conducted in ZGK Ulhówek (Lublin region) and PEC Lubań (Dolnośląskie region) in two heating seasons, 2003/2004 and 2004/2005. Among the ecological advantages the highest significance was that of the 98% reduction of sulphur oxides emission.