Abstract The effect of reaction parameters (temperature, time and biomass-to-solvent (BS) ratio) on properties (higher heating value (HHV) and O/C and H/C ratios) and yields of bio-oil produced from macroalgae (Saccharina japonica) liquefaction using supercritical ethanol (scEtOH) as a solvent was investigated. At 400 °C using a BS ratio of 1/10 and reaction time of 45 min, a high yield of bio-oil (88 wt%) with a HHV of 35.0 MJ kg−1, O/C ratio of 0.14, and H/C ratio of 1.62 was obtained. Compared with water-based liquefaction, (subcritical water at 300 °C, bio-oil yield of 43 wt%, HHV of 20.7 MJ kg−1, O/C ratio of 0.48, and H/C ratio of 2.01; supercritical water at 400 °C, bio-oil yield of 37 wt%, HHV of 29.0 MJ kg−1, O/C ratio of 0.18, and H/C ratio of 1.76), the yield and energy content of the bio-oil produced using scEtOH were significantly higher. This enhancement was attributed to the reactivity of scEtOH with the intermediates generated from macroalgae. The utility of the generated bio-oil was demonstrated by application in a commercial 100 MWe generation plant. The thermal efficiency of the bio-oil (86.0%) was quite similar to that of heavy fuel oil (HFO) (87.1%), suggesting that the HFO could be fully replaced by the bio-oil.