Several of the emerging technologies for electricity storage are based on some form of thermal energy storage (TES). Examples include liquid air energy storage, pumped heat energy storage and, at least in part, advanced adiabatic compressed air energy storage. Compared to other large-scale storage methods, TES benefits from relatively high energy densities, which should translate into a low cost per MW h of storage capacity and a small installation footprint. TES is also free from the geographic constraints that apply to hydro storage schemes. TES concepts for electricity storage rely on either a heat pump or refrigeration cycle during the charging phase to create a hot or a cold storage space (the thermal stores), or in some cases both. During discharge, the thermal stores are depleted by reversing the cycle such that it acts as a heat engine. The present paper is concerned with a form of TES that has both hot and cold packedbed thermal stores, and for which the heat pump and heat engine are based on a reciprocating Joule cycle, with argon as the working fluid. A thermodynamic analysis is presented based on traditional cycle calculations coupled with a Schumann-style model of the packed beds. Particular attention is paid to the various loss-generating mechanisms and their effect on roundtrip efficiency and storage density. A parametric study is first presented that examines the sensitivity of results to assumed values of the various loss factors and demonstrates the rather complex influence of the numerous design variables. Results of an optimisation study are then given in the form of trade-off surfaces for roundtrip efficiency, energy density and power density. The optimised designs show a relatively flat efficiency vs. energy density trade-off, so high storage density can be attained with only a modest efficiency penalty. After optimisation, losses due to pressure drop and irreversible heat transfer in the thermal reservoirs are only a few percent, so roundtrip efficiency is governed mainly by the efficiency of the compression and expansion processes: overall roundtrip efficiencies approaching those for pumped hydro schemes might be achievable whilst simultaneously attaining energy storage densities of around 200 MJ m–3, but this is contingent upon attaining compression and expansion efficiencies for the reciprocating devices that have yet to be proven.