© 2015, The Author(s). Purpose: Bioenergy is increasingly used to help meet greenhouse gas (GHG) and renewable energy targets. However, bioenergy’s sustainability has been questioned, resulting in increasing use of life cycle assessment (LCA). Bioenergy systems are global and complex, and market forces can result in significant changes, relevant to LCA and policy. The goal of this paper is to illustrate the complexities associated with LCA, with particular focus on bioenergy and associated policy development, so that its use can more effectively inform policymakers. Methods: The review is based on the results from a series of workshops focused on bioenergy life cycle assessment. Expert submissions were compiled and categorized within the first two workshops. Over 100 issues emerged. Accounting for redundancies and close similarities in the list, this reduced to around 60 challenges, many of which are deeply interrelated. Some of these issues were then explored further at a policy-facing workshop in London, UK. The authors applied a rigorous approach to categorize the challenges identified to be at the intersection of biofuels/bioenergy LCA and policy. Results and discussion: The credibility of LCA is core to its use in policy. Even LCAs that comply with ISO standards and policy and regulatory instruments leave a great deal of scope for interpretation and flexibility. Within the bioenergy sector, this has led to frustration and at times a lack of obvious direction. This paper identifies the main challenge clusters: overarching issues, application and practice and value and ethical judgments. Many of these are reflective of the transition from application of LCA to assess individual products or systems to the wider approach that is becoming more common. Uncertainty in impact assessment strongly influences planning and compliance due to challenges in assigning accountability, and communicating the inherent complexity and uncertainty within bioenergy is becoming of greater importance. Conclusions: The emergence of LCA in bioenergy governance is particularly significant because other sectors are likely to transition to similar governance models. LCA is being stretched to accommodate complex and broad policy-relevant questions, seeking to incorporate externalities that have major implications for long-term sustainability. As policy increasingly relies on LCA, the strains placed on the methodology are becoming both clearer and impedimentary. The implications for energy policy, and in particular bioenergy, are large.