The present paper describes the analysis of the melting process in a single vertical shell-and-tube latent heat thermal energy storage (LHTES), unit and it is directed at understanding the thermal performance of the system. The study is realized using a computational fluid-dynamic (CFD) model that takes into account of the phase-change phenomenon by means of the enthalpy method. Fluid flow is fully resolved in the liquid phase-change material (PCM) in order to elucidate the role of natural convection. The unsteady evolution of the melting front and the velocity and temperature fields is detailed. Temperature profiles are analyzed and compared with experimental data available in the literature. Other relevant quantities are also monitored, including energy stored and heat flux exchanged between PCM and HTF. The results demonstrate that natural convection within PCM and inlet HTF temperature significantly affects the phase-change process. Thermal enhancement through the dispersion of highly conductive nanoparticles in the base PCM is considered in the second part of the paper. Thermal behavior of the LHTES unit charged with nano-enhanced PCM is numerically analyzed and compared with the original system configuration. Due to increase of thermal conductivity, augmented thermal performance is observed: melting time is reduced of 15% when nano-enhanced PCM with particle volume fraction of 4% is adopted. Similar improvements of the heat transfer rate are also detected. Copyright (c) 2012 John Wiley & Sons, Ltd.