To mitigate carbon dioxide emissions, the European Union (EU) and many countries around the world have set into action different policy tools such as a carbon tax or feed-in tariffs. Most instruments have, directly or indirectly, an impact on the use of biomass for energy purposes. The principal policy tools relevant to bioenergy production and applied in the EU are described in this article and their observed impact on bioenergy production levels is assessed. In addition, a model application on the policy tools is presented to assess future impact of policies on production of energy carriers from lignocellulosic biomass at the EU level and at the international level. This model application is based on the optimization model BEWHERE, which determines the optimal location and technology of a set a bioenergy conversion plants, minimizing the cost of the supply chain. Sweden, Austria, and Finland are the three countries that are highlighted in the EU. An international perspective is also included by presenting a Brazilian case study. From the modeling results, it can be derived that integrated biofuel production would be the most competitive way for biofuel production and that a carbon tax and the emission trading scheme are the most cost-efficient solutions to decrease emissions.