We developed a new approach to analyze the feasibility and benefits of biomass utilization strategies for energy production. To achieve this goal, we first generated a biomass-to-energy network which consists of different conversion technologies and corresponding compounds. We then developed new optimization models using a mixed integer linear programming technique to identify the optimal and alternative strategies and point out their major cost drivers. We applied these models to the biomass-derived energy supply problem on Jeju Island, Korea, to answer a wide range questions related to biomass utilization. What is the cheapest way to produce liquid fuels from available biomass on Jeju Island? How much demand can be satisfied by biomass-derived liquid fuels? What combination of technologies and biomass resources gives the best economic benefits or productivity? Based on the case study of Jeju Island, we could provide useful guidelines to policy-makers and stakeholders in the energy business.