Publisher Summary This paper reports results from a 2-year project funded by the Swedish Energy Agency. The scope of the project was to explore how biomass cultivations in Sweden can be located and managed to obtain environmental benefits additional to those associated with the fossil fuel substitution. The potential volumes of biomass that could be produced under such schemes were assessed and the economic value of the environmental benefits were estimated. The establishment of bioenergy plantations on previously unforested land will generally involve carbon accumulation in aboveground biomass for some period before final use of the biomass for energy. The equilibrium level of aboveground carbon stock may be substantially larger than the level prior to the plantation establishment. Soil carbon may increase, decrease or remain approximately constant depending on plantation characteristics, climate, soil type and land use history. Thus, besides fossil fuel substitution, also changes in the carbon stock influence the climate change mitigation potential of bioenergy plantations. The Bonn agreement (COP6) opens up for the linking of biomass plantations with the crediting of plantation-induced carbon sinks. The analysis of the case of Salix production in Sweden indicates that the revenues from such carbon credits could be substantial. Thus, the new opportunity for crediting of the carbon sink component of plantations can have implications for the economics of biomass energy. It will also favor longer rotation periods and some types of crops over others, with annually harvested crops such as energy grasses having less incentive than short rotation forests.