Biomass-derived energy offers the potential to increase energy security while mitigating anthropogenic climate change, but a successful path toward increased production requires a thorough accounting of costs and benefits. Until recently, the efficacy of biomass-derived energy has focused primarily on biogeochemical consequences. Here we show that the biogeophysical effects that result from hypothetical conversion of annual to perennial bioenergy crops across the central United States impart a significant local to regional cooling with considerable implications for the reservoir of stored soil water. This cooling effect is related mainly to local increases in transpiration, but also to higher albedo. The reduction in radiative forcing from albedo alone is equivalent to a carbon emissions reduction of 78 t C ha-1 , which is six times larger than the annual biogeochemical effects that arise from offsetting fossil fuel use. Thus, in the near-term, the biogeophysical effects are an important aspect of climate impacts of biofuels, even at the global scale. Locally, the simulated cooling is sufficiently large to partially offset projected warming due to increasing greenhouse gases over the next few decades. These results demonstrate that a thorough evaluation of costs and benefits of bioenergy-related land-use change must include potential impacts on the surface energy and water balance to comprehensively address important concerns for local, regional, and global climate change.