The Russian government suggests recently introducing innovative "Technologies of green development". The initiative focuses on the complete utilization of waste products. The Khanty-Mansi autonomous region (KMAR) is the main oil and gasmining area in the country and at the same time has forestry as a valuable part of its economy. An estimated 50% to 60% of the total waste in Russia is caused by the forestry sector (including losses in forest harvest and wood processing). To meet the national "green development" target, forestry waste should be utilized, mainly for the production of biofuel. However, due to cheap oil and gas, the use of biofuel is not common in Russia as can be seen from the country fuel balance. Therefore, new economic and political instruments should be found in order to push the utilization process for the production of biofuel. KMAR region has financial resources and is well positioned to become a pilot for this new development.