AbstractMiscanthus has been identified as one of the most promising perennial grasses for renewable energy generation in Europe and the United States [Mitigation and Adaptation Strategies for Global Change 9 (2004) 433]. However, the decision to use Miscanthus depends to a considerable degree on its economic and environmental performance [Soil Use and Management 24 (2008) 235; Renewable and Sustainable Energy Reviews 13 (2009) 1230]. This article assessed the spatial distribution of the economic and greenhouse gas (GHG) costs of producing and supplying Miscanthus in the UK. The average farm‐gate production cost of Miscanthus in the UK is estimated to be 40 £ per oven‐dried tonne (£ odt−1), and the average GHG emissions from the production of Miscanthus are 1.72 kg carbon equivalent per oven‐dried tonnes per year (kg CE odt−1 yr−1). The production cost of Miscanthus varies from 35 to 55 £ odt−1 with the lowest production costs in England, Wales and Northern Ireland, and the highest costs in Scotland. Sensitivity analysis shows that yield of Miscanthus is the most influential factor in its production cost, with precipitation the most crucial input in determining yield. GHG emissions from the production of Miscanthus range from 1.24 to 2.11 kg CE odt−1 yr−1. To maximize the GHG benefit, Miscanthus should be established preferentially on croplands, though other considerations obviously arise concerning suitability and value of the land for food production.