In cold dry climates, due to the high demand for hot water during winter and the abundance of solar radiation, Solar Water Heating System is a promising approach to reduce the energy consumption and negative environmental impact of buildings. The objective of this research is to model and verify a direct solar water heating system in Baghdad, Iraq using TRNSYS software. This research focuses on a system of production domestic hot water for orphanage located in Baghdad and occupied by 25 persons. This is achieved by using 10 m2 of a flat plate collector and 600 liters storage tank. This system also is analyzed with an auxiliary fuel sources (electricity). SDHW system performance is evaluated against conventional DHW system performance in terms of energy and economics. Long term system performance is estimated by using TRNSYS model run with the weather values of TMY file for Baghdad, Iraq. The maximum auxiliary energy was needed during the months of December (about 1025 MJ/month) and February (about 1000 MJ/month). While the annual solar fraction obtained was 69% and the system cover the hot water needs during the cold months with the help of auxiliary electric heater.