A new method for characterization of stratified thermal energy stores (TES) that integrates both the first law and the second law concerns is presented here. The first law concern is incorporated into a quantity called energy response factor and the second law concern into an entropy generation ratio. A product of these two quantities is at the heart of the TES efficiency definitions. This approach removes the overemphasis of the existing methods either on the first or the second law of thermodynamics which often biases the characterization results. The information about the evolution of the temperature field of the system in time is the prerequisite of the new method. It may be obtained from experiments or from suitable numerical simulations. The current method can be easily integrated into computational fluid dynamic (CFD) simulations and thus facilitate CFD-based design analysis. As an example of such CFD-integrated analysis, a large-scale hot water seasonal heat store is numerically studied to identify the effects of aspect ratio, containment shape, internal structures, and containment size on their efficiency. The results suggest the effectiveness of the new method in deriving useful design insights. (c) 2006 Elsevier Ltd. All rights reserved.