To meet renewable energy and climate change targets, expanding electricity production from biomass will play an important role in many EU member states. However, in designing policies to promote bioenergy, policy makers face challenges concerning, for example, uncertainties about greenhouse gas balances of heterogeneous bioenergy pathways, sustainability of biomass production, technology and resource costs, or future framework conditions of energy markets. New information becomes available with time, but policy adjustments can involve high levels of negotiation and adaptation costs. To enable an effective steering of technology choices and innovation efforts, policies have to strike a balance between creating a consistent institutional framework, which establishes planning security for investors, and sufficient flexibility to adapt policy instruments to new information. Additionally policies need to be in line with legally binding emission reduction targets. We examine implications of economic theory for handling uncertainties in bioelectricity policy design, focusing on choices between price and quantity instruments, technology differentiation, and policy adjustment. Findings are then applied to an analysis of two case studies, the UK’s Renewables Obligation and the German feed-in tariff/feed-in premium scheme, to examine how relevant trade-offs have been addressed in practice. Based on this, we derive potential policy recommendations.