Abstract A plant converting sugarcane bagasse to liquid fuels through thermal liquefaction in an Australian setting was modelled in ASPEN Plus. Ethanol was investigated as a liquefaction solvent due to its effect of higher yields and higher biocrude heating value compared to water (i.e. hydrothermal liquefaction). The plant produced 0.67 kg biocrude per kg dry feed, which was further processed to 0.46 kg liquid fuels per kg of dry feed for a total of 25.8 million L/y of biofuel product. Ethanol losses incurred the highest share in operating costs, although there are opportunities for cost reduction around lower solvent to biomass ratio. Over the plant life and with a corporate tax rate of 30%, it was determined that the minimum selling price for the fuel products is US$ 0.99/L, which was comparable to other liquefaction studies using water as solvent. It was demonstrated that continuous operation mode was economically more advantageous than semi-batch production. Product price, hydrodeoxygenation conversion efficiency and plant capacity were determined to be the factors to which NPV is most sensitive, while biocrude yield and hydrodeoxygenation conversion efficiency were the key factors in decreasing the minimum selling price of the product to a level that can be competitive.