In this paper we present a methodology for systematically optimizing the power supply voltage for maximizing the performance of VLSI circuits in technologies where leakage power is not an insignificant fraction of the total power dissipation. For this purpose, we develop simplified empirical equations which describe the transistor behaviour as a function of power supply and temperature. We use these models to calculate the full-chip power dissipation as a function of power supply and temperature. We then solve the power and chip thermal equations simultaneously to calculate the chip temperature and power dissipation at a given power supply. By varying the power supply voltage we determine the optimum V_DD value which minimized delay per unit length in global interconnects and therefore maximizes performance. We show that for 90 nm and 65 nm technologies where leakage power represents a significant fraction of the total power dissipation, optimum V_DD is lower than the ITRS specified supply voltage. This is due to the fact that reducing V_DD results in a large reduction in total power dissipation and therefore the chip temperature which improves performance. This improvement in performance is greater than the performance penalty incurred due to reduction in V_DD.