Abstract The development of cost-effective energy storage systems with low environmental impact is crucial for the energy transition to enable the widespread use of renewable energy sources. Within this context, there is an increasing interest in Compressed Air Energy Storage (CAES), especially for its potential application in small-scale off-grid systems. In this study, a numerical model of a micro-CAES system for off-grid applications, with an output power of 5kW , is developed; the open source, object-oriented software OpenModelica is used and the model is validated by comparison with available experimental data. Following the validation, the model is used to identify the main exergetic losses and a series of efficiency enhancing solutions are evaluated, using the round-trip efficiency as an indicator. The study allows to identify the main technical aspects to focus on, in ordedr to improve the system, as well as the limit performance that the adopted CAES concept would allow to achieve.