Abstract This paper characterized the wood pellet and torrefied wood pellet fuel as compared to coal for 100 MW co-firing power generation plant. There were five experiments to characterise the chemical and physical properties of coal, wood pellet and torrefied wood pellet namely moisture analysis, Thermo gravimetric Analyser (TGA), Bomb Calorimeter, Organic Elemental Analyser and Scanning Electron Microscope (SEM). The moisture analysis result from moisture analyser and TGA shows that the moisture content of torrefied wood pellet is lower than wood pellet at 6.760% and 3.629%. Moreover, the volatile matter, hydrogen and nitrogen content of torrefied wood pellet is lower than wood pellet at 65.20%, 5.993% and 0.4078% correspondingly. The calorific value, fixed carbon content, ash and sulphur also increase in torrefied wood pellet at 20.68 MJ/kg, 28.85%, 2.321% and 0.1656% respectively. In general, torrefaction improve the fuel properties of wood pellet similar to coal. The 100 MW direct co-firing power plant provides less capital investment, operation and maintenance cost for low rate co-firing ratio. However, there is economic challenges for high rate co-firing substation of torrefied wood pellets.