A small-scale demonstration plant, which consists of a rotary kiln-type oven and a ring die-type pelletizer, was manufactured to produce upgraded wood fuel by torrefaction. In this study, we improved the temperature control and the pelletization methods. The oven and pelletization operations were optimized by implementing automatic temperature control of the torrefaction oven, and the use of additives in pelletization; which resulted in improvements in pellet productivity. A commercial scale image of the torrefaction plant was designed for operation in a local community. Torrefied fuel could be used for both large-scale power generation and small-scale use, such as for cooking and heating (e.g. in restaurants), in the outdoors, and during emergencies.