This paper evaluates the performance of narrow-gap vertical mantle heat exchangers with a two-pass arrangement for use in pumped-circulation solar water heaters. Both measured mantle side and tank side heat transfer correlations have been developed and implemented in a TRNSYS model of a complete solar water heater incorporating this type of heat exchanger. Predictions of the annual solar contribution for mantle-tank systems are compared to direct-coupled systems. The direct-coupled systems are found to provide slightly higher annual energy saving than mantle-tank systems for standard domestic hot water demand in Australia. However, the reduction in performance is outweighed by the benefit of freeze protection provided by incorporating a collector loop heat exchanger in the system. (c) 2008 Elsevier Ltd. All rights reserved.