Waste heat capture from systems such as photovoltaics (PV) and refrigerators can lower their energy efficiency by increasing their operating temperature. In this study, we evaluate the potential of final-effect evaporative cooling and internal heat recovery in a multi-effect diffusion distillation (MEDD) to produce pure water without negatively impacting the energy efficiency of the waste-heat source. Lab-scale experimental results from a multi-effect membrane distillation module validate the concept, showing that water production can be enhanced by >20 % while simultaneously pulling down the module's operating temperature. A detailed numerical model of a solar-MEDD is implemented and validated. The incorporation of sensible heat recovery and evaporative cooling increase pure water production by approximately 10 % each. Although the pure water production of a standalone MEDD increases with increasing effects N, when coupled to a solar PV module, increasing N also decreases PV electricity production. Therefore, a PV-MEDD with fewer effects (≤4) is preferable and such a system can produce sufficient water for electrolysis (green H2 production) while maintaining or improving PV electrical energy production throughout the year under varying climatic conditions.