Abstract: To idle arable land and converts it to forest/grassland in western China has been proved as an effective way to ecological restoration and to stop desertification. However the relevant policy of subsidy is unsustainable, and subsequent agro-industries is difficult to establish based on the fallow fields. Although climate conditions do not favor to cropping of grain in the interlaced zone of agriculture area and pasture, it does relatively favor to the planting of vegetation (biomass)-oriented crops, thus gaining relatively higher ‘system productivity’. China owns very limited arable land, but ample resource of grassland and forest land. Newly emerged energy cropping system in the developed countries could be adopted in China on vast marginal land of Loess Plateau. The so-called dedicated energy crops, such as Miscanthus and switchgrass etc., have been primarily tested within Loess Plateau, and proved to be the promising crops for ‘win-win solution of ecological benefits and economic benefits. It is estimated that there are about 20 million hectares of marginal land that are suitable to energy grasses and will be produced more than 400 million tons of biomass feedstuff annually, thus making this area one of the most important feedstuff base candidate for bioenergy industry in China.