In this paper, an optimization method is proposed to improve the performance of a novel heat exchanger with latent heat thermal energy storage. Paraffin/expanded graphite composites were used as phase change material filled in annular tube, maintained contact with the shell and tube flow channels simultaneously. The heat transfer and flow characteristics of this novel heat exchanger were investigated in a previous study, which indicated that further research was required to enhance thermal transfer rates. Therefore, in this work, the thermal property of the material and geometric parameters of the heat exchanger, including compression density, tube diameter, and fins and baffle configuration, were studied numerically to improve the thermal behavior of the system. It was found that a composite with density of 600 kg/m(3), a tube diameter of 19 mm, and an extended surface and baffle space of 100 mm, can be used for the final optimization result. The results show that, after optimization, the thermal conductivity of the phase change material can reach 5.16 W/m K and the latent thermal energy stored in system could be twice that previously obtained. The solidification rate can increase to a maximum of 50% while the shell side Nu/Pr-1/3 can reach 29.98. The improved heat exchanger shows better energy storage capacity and working power. (C) 2019 Elsevier Ltd. All rights reserved.