A solar plant for hot-water production was investigated by the dynamic simulation code (TRNSYS). A typical daily home consumption for a 4 persons family was considered. The hot-water demand temperature (53 degreesC) is controlled by a conventional fuel auxiliary heater and a tempering valve. A heat-exchanger is considered between collector and storage tank. The fluids circulate by pumps activated by photovoltaic panels. This simplifies plant control systems and allows for stand-alone utilization of the plant. Annual energy performance, in terms of solar fraction, was calculated for three Italian localities. The economic viability of such a plant was evaluated with the life cycle savings (LCS) method, considering three conventional fuels (Gas-Oil, LPG and Electricity). Italian Government incentives show an economic viability only in comparison with electrical energy. (C) 2003 Elsevier Science Ltd. All rights reserved.