•Here, we demonstrate thermoelectric performance of allotropic TeSe2.•We confirm the energetic and kinetic stability of five TeSe2 allotropes.•δ-TeSe2 is found a new direct band gap semiconductor (Eg = 1.60 eV).•Figure of merit (ZT) can reach up to 3.1 with p-type doping in δ-TeSe2.•Temperature and chemical potential tuning extends the thermoelectric performance of TeSe2 allotropes. The waste heat management becomes very important with increasing energy demand and limited fossil resources. Here, we demonstrate thermoelectric performance of allotropic TeSe2. Based on the first-principle calculations, we confirm the energetic and kinetic stability of five TeSe2 allotropes. We predict δ-TeSe2 as a new direct band gap semiconductor having 1.60 eV direct band gap. All the TeSe2 allotropes exhibit band gap in UV–Vis region. The structural phases are clearly distinguished using simulated scanning tunneling microscopy. The room temperature Seeback coefficient is maximum of 4 mV/K for δ-TeSe2. We show that room temperature thermoelectric figure of merit (ZT) can reach up to 3.1 with p-type doping in δ-TeSe2. Moreover, temperature and chemical potential tuning extends the thermoelectric performance of TeSe2 allotropes. We strongly believe that our study is compelling from an experimental perspective and holds a key towards fabrication of thermoelectric devices based on TeSe2.