The islands of the European Community face much the same problems as other areas, but to an accentuated degree. Their geographical isolation, in most cases from energy supply, production and distribution systems, creates problems such as higher costs, vulnerability of supplies, high local environmental impact and waste disposal From a social and economic point of views, the islands have experienced two clear trends over the past 10 years: the first, increased tourism, and, the second, modernization of traditional economic sectors such as agriculture and fisheries. The overall impact of these trends on the energy sector has been a doubling of island power consumption in just 10 years. THERMIE plays an important role on the islands, since the benefits of energy saving (or energy substitution) are magnified by the specific island situation, where the price of energy is a crucial factor in economic and social development. Almost 100 energy technology projects have received Community support under the energy demonstration programme (1979-1989) and in the current THERMIE programme (1990-1994). Of these, 80 have proved successful. The total investment in these 80 projects is about ECU 92 million, with EC support representing approximately ECU 29 million of that. A project breakdown shows that 59 out of the 80 projects are in the fields of wind and solar energy. This shows that renewable energy sources present the most promising opportunities for development on the islands. As regards geothermal energy, despite the limited number of projects (four), the energy substitution effect obtained by their implementation represents half of the total energy saving or substitution achieved by all 80 projects. Another sector with an apparent high level of effectiveness, but which is still insufficiently exploited, is mini-hydro. THERMIE associated measures play a major role for disseminating the wide experience gained through the 80 supported projects. Examining OPET (Organizations for the Promotion of Energy Activities) activities over the period January 1991 to June 1992, 32 promotional actions of particular interest for the islands can be identified.