AbstractThe appropriate storage, transportation, and utilization of wood-based fuels, including woodchips, pellets, and sawdust, in the energy production process, depends on their efficient drying. Traditional drying methods include limitations such as high thermal losses, inefficient heat transfer, and sustainability issues. These barriers, coupled with the high costs and complexities of maintaining the desired moisture content, underscore the need for innovative solutions. This study introduces a novel approach to wood fuel drying through the integration of phase-change materials (PCMs) with hybrid solar drying systems, aimed at enhancing thermal efficiency and sustainability. Employing coconut oil as the PCM, experiments were performed under a consistent artificial radiation of 755 W m−2. The hybrid system demonstrated the capability to retain approximately 200 watts of useful heat for three hours post-radiation, marking a significant improvement in heat storage. Our findings reveal peak thermal and exergy efficiencies of 30–35% and 13–14%, respectively. An economic and environmental analysis predicts a system lifespan of five years, with the cost of generating one kilogram of hot air at 0.0058 EUR and an annual CO2 emission of 64.09 kg. This research offers a cost-effective and environmentally friendly method for wood fuel drying, presenting a significant advancement for large-scale producers and setting a benchmark for further exploration of wood fuel drying technologies.