The need for a practical, economic and environmentally sound solution for waste wood arises from the requirements for resource conservation and recent regulations. Co-firing with coal is a promising option for the thermal recycling of waste wood. The overall environmental impact caused by the co-utilisation of waste wood with coal was evaluated by using life cycle assessment as established by Society of Environmental Toxicology and Chemistry (SETAC) [A technical framework for life cycle assessment. Washington, DC: SETAC, USA; 1991, Guidelines for life cycle assessments: A code of practice. Brussels: SETAC, Europe; 1993]. This provides opportunities to evaluate direct environmental impact, to identify possible improvements, and to reduce energy resource consumption. In this work, the environmental impact of co-utilising lignite and waste wood in an industrial steam boiler was evaluated. Results obtained showed that co-utilisation is technically feasible and can meet strict environmental standards. A net decrease of CO2 emissions can be achieved by the thermal use of waste wood, as well as conservation of fossil fuel resources, minimisation of waste disposal and reduction of impacts on health.