The UK government has committed to generate 20% of the country's energy from renewable sources by 2020. This paper investigates energy reduction in houses by using an innovative solar thermal collector combined with a heat pump system. The dynamic lumped parameter model for a small house is derived and the combined heating system is used to provide the typical hot water and heating requirement. The goal is to maintain thermal comfort inside the house and reduce the amount of electricity consumption used for heating and hot water. This is achieved by reducing the electricity costs through optimising the operation of the heat pump, integrating the available solar energy, and by shifting electricity consumption to the cheaper night time tariff. Models of conventional controller on-off and a multi-variable model predictive control (MPC) are developed and used for several different climatic conditions. The results showed that the model predictive controller performed best by providing better comfort, consuming less electric energy and better use of cheap night time electricity by load shifting and storing heat energy in the heating tank. (C) 2013 Elsevier B.V. All rights reserved.