Abstract This paper presents an innovative water photovoltaic thermal collector prototype. One of the main novelties of such system is its economic affordability, obtained through low-cost materials. The collector, constructed and experimentally tested at the University of Patras (Greece), is composed of a polycrystalline photovoltaic module coupled to eleven plastic pipes for water heating, located under the PV panel in an aluminium box. The prototype, suitable for building architectonical integration, can provide domestic hot water and electricity to the building. In order to assess the energy, economic and environmental performance of the system under different weather conditions and for diverse building uses, a suitable dynamic simulation model was developed and validated vs. experimental data. To investigate the convenience of the presented prototype and the potentiality of the developed software, a suitable case study is presented. In particular, the photovoltaic thermal collector is coupled to a stratified hot water storage tank for supplying domestic hot water to a single-family house located in three different European weather zones: Freiburg, Naples and Almeria. The system layout optimization was also performed through an energy and economic sensitivity analysis to some design and operating parameters. Useful design criteria and interesting energy and economic results were obtained.