Biomass is the fourth largest energy source in the world; it is easy to store and can be converted into various kinds of renewable energies. The biomass cogeneration system is an important way to utilize biomass energy, especially in northern China. At present, there are many problems in biomass power plants in China, such as high latent heat loss of chimney and cooling towers, low power generation efficiency, and thermal efficiency. In order to solve this problem, this paper introduces low vacuum circulating water heating technology in the biomass cogeneration system, and expounds the differences between China and Western countries in biomass power plants. Based on this background, the technology is redesigned and reformed to make it more suitable for the biomass fuel varieties in the power plant location, and realize the localization of technology and the expansion of scale. The application of this improved technology in China’s biomass cogeneration project is analyzed. Based on the biomass cogeneration project in the DC County of China, the analysis confirms that the designed low vacuum circulating water heating technology is suitable for biomass power generation projects with agricultural and forestry wastes as raw materials, and its application can greatly improve the heat utilization efficiency of the whole cogeneration system. At the same time, in order to estimate the possibility of profitable investment when the key financial parameters change, the financial risk is analyzed. The results show that the probability of 90% net present value (NPV) in 15 years is between 355.28 million RMB and 623.96 million RMB, and the internal rate of return can reach 17.7%.