The cost of wood, which form traditional feedstocks for biomass gasification, has been sharply increasing in recent years. Hence, low cost alternative feedstocks, such as forest residues, need to be explored to retain the economical edge. Forest residues (FR) are the materials left behind on the forest floor after forest harvesting and management activities. The present study explores the effect of forest residues as feedstock in a downdraft gasifier coupled with a small-scale combined heat and power (CHP) system, consisting of a diesel engine-alternator setup. The findings reveal that the FR mixtures change the flow behaviors of both feedstock and air in the reactor. While the average composition of the producer gas is similar to that of wood chips, a stratified bed with uneven flow leads to an unpredictable nature in the equivalence ratio which is a process controlling parameter. This is also reflected in gas parameters such as the heating value and cold gas efficiency, which in turn leads to unpredictability in the overall performance of the CHP system, evident in its electrical and thermal efficiencies, and exhaust gas components like CO, CO2, and NOx. Diesel substitution rates (DSR) of up to 59% and 46% for partial and full electrical loads respectively were realized. While emissions of CO and CO2 increased with increasing DSR, supplementing diesel with producer gas has benefits in terms of the pollutants NOx and PM, which were found to be generally lower for the FR mixtures. In the case of NOx, reductions of over 65% was achieved.