Organic phase-change material for enhanced energy storage was prepared by adding SiO 2 particles in a certain proportion into molten palmitic acid (PA) with stirring and intensive sonication at a constant temperature. The thermal properties of the SiO 2 /PA composite were experimentally characterized. As compared with pure PA, the latent heat capacity of the composite with the addition of 3 wt% SiO 2 particles is increased by 51.7 kJ/kg, reaching 214.7 kJ/kg, which is the highest value among the composites tested with varying SiO 2 ratio from 1 to 5 wt%; the thermal conductivity of the 3 wt% SiO 2 /PA composite is also increased by 12% at 30 • C (solid state) and 7% at 70 • C (liquid state), respectively. A water heater was built and tested with embedded capsules containing the 3 wt% SiO 2 /PA composite and pure PA, respectively. The lab-built phase-change water heater is much smaller in size than an ordinary household water heater in comparison and uses reduced electrical power. However, it responds faster and has a larger volume ratio of hot water output to water heater size. During the turning-off test, the water heater with 3 wt% SiO 2 /PA can provide 2.23 times hot water volume of heater size; while the ordinary water heater can only provide 1.41 times hot water volume of tank size.