A thermal and life cycle analysis was conducted to compare two types of solar service hot water systems: 1. (1) the straight-through system with the water driven by the pressure of the mains through a heat exchanger in which it is heated by the warmer water in the solar-thermal storage tank, whenever demand for service hot water is created, and 2. (2) the recirculation system in which a temperature-difference-controlled recirculation loop is used between the solar-thermal storage tank and the auxiliary (or backup) service hot water tank. The latter configuration which needs to have these additional components (controller, pump, and piping) and may thus also be less reliable, is more frequently used when the solar system is to supply both space heat and service hot water, because it is generally though to provide a larger fraction of the hot water from the solar source. A computer program, combining TRNSYS with a comprehensive present-value life-cycle model and an optimization link was prepared and run for a representative year in Philadelphia to determine the thermal storage, heat exchanger, and controller-setting combination which produces the minimal present-value life-cycle costs. To provide more generality to the results, these calculations were repeated for a wide range of temperature levels and transient patterns of the solar-collector-heated water in storage and of the service hot water demand patterns, quantities, and temperatures. Apart from some uncommon cases, it was found that the straight-through solar heating system is better than the recirculation one with respect to all comparison criteria: present-value life-cycle cost, auxiliary energy consumption, and reliability.