The preparation of activated carbon using palm kernel shells as the precursor (PKSAC) was successfully accomplished after the parametric optimization of the carbonization temperature, carbonization holding time, and the ratio of the activator (H3PO4) to the precursor. Optimization at 500 °C for 2 h of carbonization with 20% H3PO4 resulted in the highest surface area of the activated carbon (C20) of 1169 m2 g−1 and, with an average pore size of 27 Å. Subsequently, the preparation of shape-stabilized phase change material (SSPCM-C20) was done by the encapsulation of n-octadecane into the pores of the PKSAC, C20. The field emission scanning electron microscope images and the nitrogen gas adsorption-desorption isotherms show that n-octadecane was successfully encapsulated into the pores of C20. The resulting SSPCM-C20 nano-composite shows good thermal reliability which is chemically and thermally stable and can stand up to 500 melting and freezing cycles. This research work provided a new strategy for the preparation of SSPCM material for thermal energy storage application generated from oil palm waste.