Latent heat is a valuable concept to understand, since it provides the fuel for thunderstorms in particular and weather events in general. Put simply, heat is either absorbed or released when substances change their state. The substance we're concerned with meteorologically is, of course, water.
Because of the strength of the hydrogen bonding between water molecules, water is one of the most unique elements on the planet (from Penn State's Essentials of Oceanography web site):
• it has the highest heat capacity of all solids and liquids with the exception of ammonia (NH3);
• the highest latent heat of fusion (the amount of heat required to change a unit mass of solid to liquid without a change in temperature), again with the exception of NH3;
• the highest heat conduction of all liquids;
• the highest surface tension of all liquids;
• transparency (large absorption of radiant energy).
As we know, water can exist in three states…solid, liquid, and gas. As water passes from one state to another, it either absorbs heat or releases it. In order for ice to melt, it must absorb heat. For water to become water vapor, it must absorb still more heat.
Note that ice is the most ordered state of water. It is crystalline in nature, rigid, and its molecular state shows very little molecular movement. Water is less ordered and water vapor is the least ordered. In ice, the molecular bonds are quite strong and it takes a lot of energy to weaken those bonds. Once the bonds have been weakened adequately, ice will transition to a liquid state. With continued addition of energy, the bonds will weaken enough to allow water molecules to escape into the atmosphere as a gas. Whenever heat is added to water, it is necessarily subtracted from the surrounding atmosphere resulting in the familiar cooling effect.
The energy required to evaporate or condense water is approximately 7.5 times that of melting or freezing. For that reason, melting ice or snow has less cooling effect than evaporation. Evaporation's cooling effect is dependent on the degree of saturation of the air. Sweat that cools your skin on a day with 40% relative humidity is far less effective at 90% humidity.
Let's take a pan full of ice and place it on a stove burner. Applying heat from the burner will cause the ice in the pan to melt. As the the ice turns to water, the water itself will not rise above 0°C until all of the ice has melted. Where does all of the heat go? The heat goes into changing the state of the water from solid to liquid, i.e. weakening the molecular bonds of the frozen water. It is, in effect, being stored in the water. This "hidden" heat is referred to as latent heat. As defined by Webster's Dictionary, latent means "present and capable of emerging or developing but not now visible, obvious, active, or symptomatic."
As we said, the temperature of the water will not rise above 0°C until all of the ice has been converted to a liquid state. At that point the water temperature will continue to rise until the liquid water begins to change to a vapor. This occurs at the boiling point of water, 100°C at a pressure of 1 Atmosphere. The water temperature will not rise above 100°C until all of the liquid has turned to vapor.
Now lets look at how this affects thunderstorms. Energy that is stored when liquid water turns to water vapor is released back into the atmosphere when the water vapor begins to condense. As air is lifted via terrain (orographic) lifting, frontal lifting, or thermal lifting, the air parcel eventually reaches the Level of Free Convection (LFC), where the parcel becomes warmer than the surrounding atmosphere. At that point, the parcel will begin to rise on its own.
Corresponding with the LFC is the Lifting Condensation Level. This elevation generally denotes the bottom of the clouds as the parcel's relative humidity reaches 100% and the water vapor begins to condense. As the water vapor turns into liquid water drops as clouds, the latent heat stored in the water vapor when it was converted from liquid to vapor is now released back into the surrounding atmosphere, warming it further and providing more fuel to propel the air parcel upward.
All of these factors combined provide the energy that creates thunderstorms: initial lifting and convection, followed by condensation, release of latent heat, more convection, and bang.