In this thesis the investigation of the possible use of solar energy for large scale waterrnheating system is conducted for the following sites in Ethiopia: Addis Ababa Tannery,rnDire Tannery, Modjo Tannery, and Jimma Hospital.rnThe thesis focuses on simulation of large-scale solar water heating system and itsrneconomic analysis. Transient performance of the system is computed using a numericalrnheat transfer model of a single glass cover flat plate collector solar water heater with riserrnand header type active system. The various design parameters are gathered from therninside country solar water heater manufacturers and dealer companies and also from thernworld experience. The meteorological data for simulation was prepared by taking thernaverage of five years starting from 2001 - 2005.rnFrom the annual contribution of solar energy to the heating load and the estimatedrninvestment cost, the unit solar energy cost and the pay back period of the system for eachrncase were calculated.rnThe result obtained indicates that the unit solar energy cost for all cases are less than thatrnof unit cost of fuel heating. Hence the solar energy is the viable alternative source ofrnenergy for large-scale water heating systems in Ethiopia