Improving the energy efficiency of buildings and reducing the environmental burden associated with conventional insulation materials has intensified the search for more sustainable construction alternatives. This study investigates the thermal and energy performance of a mycelium-based composite (MBC) in comparison with expanded polystyrene (EPS) within lightweight structural insulated panel (SIP) systems. Thermal properties and their influence on the energy behavior of a simplified prototype located in two bioenvironmental zones (IVa and V) of Mendoza, Argentina, were assessed. The analysis involved the determination of U-values following relevant standards and building energy simulations conducted in EnergyPlus. The main results show that the MBC must increase its thickness to 75 mm in order to achieve a performance comparable to that of a 50 mm EPS. A 1% difference in annual heating demand is observed between the two insulation materials. Overall, the findings position MBC as a promising thermal insulation alternative and underscore the need to address remaining challenges related to its physical properties, durability, and scalable manufacturing to support its practical adoption in the construction sector