Microwave assisted hydrothermal carbonization (MAHTC) is a promising strategy for fuel production from sugarcane bagasse. Even though microwave heating has been reported to facilitate product (hydrochar) yield, energy properties and heating efficiency during hydrothermal carbonization (HTC) process, the environmental consequences of MAHTC treatment were still not clear. This study evaluated the environmental impact associated with 1 MJ electricity generation from sugarcane bagasse hydrochar through life cycle assessment (LCA) method, focusing on the critical role of process-based parameters to provide insights for optimization of MAHTC treatment. Specifically, two different allocation factors (energy content and economic value) and five environmental impact categories (climate change, freshwater eutrophication, freshwater ecotoxicity, human toxicity and fossil depletion) were assessed in this study. The LCA results revealed significant contribution of MAHTC process on climate change and fossil depletion because of large energy consumption used to maintain the system at designed temperature. Discharge of liquid phase from MAHTC process resulted in severe eutrophication impact especially when economic value was used as allocation factor. Gas emission from hydrochar combustion caused most toxicity related impacts indicating essential requirement of further investigation to quantify different gaseous composition. Based on LCA results, sensitivity analysis indicated hydrochar yield and carbon content as the top two influential factors on total environmental consequences. Comparison study with other fuel sources were further conducted to identify the influence of substituted energy sources. The overall results suggested MAHTC as promising method for bagasse utilization and energy retention efficiency as important indicator for optimization of MAHTC treatment or the sake of high quality products and good environmental performance. (c) 2021 Elsevier Ltd. All rights reserved.