Autumn-harvested cereal straw and spring-harvested reed canary grass (Phalaris arundinacea L.) are renewable energy sources with similar material characteristics. The fuels can be harvested and handled with the same machines, stored in the same stores, and fired with the same equipment. Thus, there is a possibility to reduce costs and increase supply reliability at many locations by using reed canary grass (RCG) as a complementary fuel in straw-fired district heating plants. The objective of this study was to find appropriate machinery combinations, straw/RCG proportions and storage capacities in order to reduce the total costs of the fuel system. The tool for the analyses was a modified dynamic simulation model for straw handling called SHAM (Straw HAndling Model). To include handling of RCG, SHAM was extended with submodules for calculation of daily fuel use, soil moisture contents and early crop growth. The model was applied to a fictitious heating plant in Enkoping in central Sweden as a case study. The simulations showed that the total costs can be lowered by using both straw and RCG in suitable proportions instead of solely using straw, although the primary fuel cost for RCG is more than three times higher per GJ than for straw. The choice of reserve base load fuel had a significant impact on the results, particularly when the RCG proportion was small, because the consumption of the reserve fuel became proportionally higher in such cases.