Advancing Multi-Energy Systems with Thermal and Electrical Storage: A Literature Review on Levelized Cost Reduction

The global energy transition has intensified the integration of renewable energy sources, yet their variability and intermittency pose persistent challenges for reliability, flexibility, and economic efficiency. Multi-energy systems (MES), which couple electricity, heat, and other energy carriers, are increasingly viewed as a promising pathway for addressing these issues. This literature review systematically examines the role of thermal energy storage (TES) and electrical energy storage (EES) in reducing the Levelized Cost of Energy (LCOE) across diverse MES configurations. Using a systematic literature review approach guided by the PRISMA framework, 112 peer-reviewed studies published between 2010 and 2025 were analyzed to evaluate technological, economic, and operational contributions of storage integration. The findings reveal that TES enhances load shifting, seasonal balancing, and waste heat utilization, contributing to cost reductions of up to 25% in district heating applications, while EES reduces curtailment, supports grid stability, and is projected to lower solar–battery system LCOE to below 60 USD/MWh by 2030. Crucially, joint TES–EES deployment offers synergistic benefits, with integrated MES achieving cost savings of 20–35% compared to single-storage configurations. Geographic and sectoral differences further shape outcomes, with stronger impacts observed in district energy systems, industrial processes, and renewable-based microgrids, particularly in developing regions where hybrid storage reduces LCOE by up to 60% relative to diesel-based systems. Despite these promising trends, research gaps persist in empirical validation, methodological consistency in LCOE assessment, and socio-institutional analysis of storage adoption. This review contributes to advancing theoretical understanding of MES as socio-technical systems, highlights innovation pathways such as hybrid and long-duration storage, and underscores the importance of supportive policy frameworks. Addressing these gaps through integrated RD&D, standardized economic metrics, and inclusive governance can accelerate the deployment of TES and EES in MES, driving cost-effective, equitable, and sustainable energy transitions.