Abstract This study was designed to consider all nitrogen fertilizer-related effects on crop production and emission of greenhouse gases on loamy sandy soils in Germany over a period of nine years (1999–2007). In order to set up a CO 2 balance for the production of energy crops, different nitrogen pathways were investigated, such as direct N 2 O emissions from the soil and indirect emissions related to NO 3 leaching and fertilizer production. Fluxes of N 2 O were measured in an experimental field using closed chambers. Poplar ( Populus maximowiczii × P. nigra ) and rye ( Secale cereale L.) as one perennial and one annual crop were fertilized at rates of 0 kg N ha −1 yr −1 , 75 kg N ha −1 yr −1 and 150 kg N ha −1 yr −1 . The mean N 2 O emissions from the soil ranged between 0.5 kg N ha −1 yr −1 and 2.5 kg N ha −1 yr −1 depending on fertilization rate, crop variety and year. The CO 2 fixed in the biomass of energy crops is reduced by up to 16% if direct N 2 O emissions from soil and indirect N 2 O emissions from NO 3 leaching and fertilizer production are included. Taking into account the main greenhouse gas emissions, which derive from the production and the use of N fertilizer, the growth of poplar and rye may replace the global warming potential of fossil fuels by up to 17.7 t CO 2 ha −1 yr −1 and 12.1 t CO 2 ha −1 yr −1 , respectively.