This study introduces the theory of a microcalorimeter based on phonon-blocked superconducting tunnel junctions, integrating on-chip electron cooling and boundary resistance phonon isolation to achieve exceptional energy resolution and rapid thermal response. A general theoretical framework is presented, along with derived approximate analytical expressions for key performance metrics, including cooling factor, thermal time constant, noise equivalent power and energy resolution. The work examines the influence of device parameters, including non-ideal effects such as subgap tunneling and heat backflow, and offers insights into optimizing the detector performance. The findings highlight the potential of the phonon-blocked junction microcalorimeters to rival or even outperform state-of-the-art technologies such as transition-edge sensors, paving the way for applications requiring precise and fast energy spectroscopy.