The usefulness is illustrated of exergy analysis in providing insights into the behaviour and performance of thermal energy storage (TES) systems, by providing an overview of many investigations by the authors on this topic. Several topics are covered. First, exergy analysis is described and thermodynamic considerations in TES evaluation are discussed. Then, the exergy analysis of a closed TES system is detailed, highlighting two critical factors: appropriate TES efficiency measures and the importance of temperature in TES evaluations. Next, applications of exergy to several TESs are discussed, including aquifer systems, stratified storages and cold TES. Finally, uses of exergy methods in optimization and design are illustrated by determining optimal discharge periods. Copyright (C) 2003 John Wiley Sons, Ltd.