A two-phase, non thermal equilibrium-based model is applied to the numerical simulation of laminar flow and heat transfer characteristics of suspension with microsize phase-change material (PCM) particles in a microchannel. The model solves the conservation of mass, momentum, and thermal energy equations for liquid and particle phases separately. The study focuses on the parametric study of optimal conditions where heat transfer is enhanced with an increase in fluid power necessary for pumping the two-phase flow. The main contribution of PCM particles to the enhancement of heat transfer in a microsize tube is to increase the effective thermal capacity and utilize the latent heat effect under the laminar flow condition. An effectiveness factor $εeff$ is defined to evaluate the heat transfer enhancement compared to the single-phase flow heat transfer and is calculated under different wall heat fluxes and different Reynolds numbers. The comparison is also made to evaluate the performance index, i.e., the ratio of total heat transfer rate to fluid flow power (pressure drop multiplied by volume flow rate) between PCM suspension flow and pure water single-phase flow. The results show that for a given Reynolds number, there exists an optimal heat flux under which the $εeff$ value is the greatest. In general, the PCM suspension flow with phase change has a significantly higher performance index than the pure-fluid flow. The comparison of the model simulation with the limited experimental results for a MCPCM suspension flow in a $3mmdia$ tube reveals the sensitivity of wall temperature distribution to the PCM supply temperature and the importance of characterizing the phase change region for a given tube length.

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