The torrefaction of biomass is a thermochemical process based on the de composition of hemicellulose, which is the dominant reaction, while the cellulose and lignin fractions remain almost unaffected. Torrefaction of biomass improves its physical properties like grindability, particle shape, size, and distribution, pelletability, and composition properties like moisture, carbon and hydrogen contents, and calorific value. The already higher energy density can be increased further by a pelletizing step after torrefaction. These improved properties make torrefied biomass particularly suitable for co-firing in power plants. Co-firing biomass with fossil fuels is one of the solutions to reduce the greenhouse gas emissions of existing power plants. Several studies on torrefaction of biomass for heat and power applications have been documented in the literature, which need to be reviewed and analyzed for further actions in the field, because significant gaps remain in the understanding of the biomass torrefaction process, which necessitate further study, mainly concerning the characterization of the torrefaction chemical reactions, investigation of equipment performance and design, and elucidation of supply chain impacts. This is the main objective of the present review study, which consists in three parts. The first part focuses on the mechanism of biomass torrefaction. It is followed by a review of biomass co-firing with coal. Finally, market opportunities for the process are discussed.