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Watergy project is funded by the European Community’s Vth Framework in its Energy, Environment and Sustainable Development programme. It consists of the development of a humid air solar collector system that follows the principle of a closed two phase thermosyphon. A combination of evaporation and condensation allows to use solar thermal energy in a much more efficient way. The main advantage is not only the reduction of costs in space cooling and heating, but the possibility of water purification, as the system can be fed with low quality water to obtain distilled water. The decentralization of heat and water supply opens the possibility of residential areas where greenhouses fed with low quality water (grey water and brackish water) could be used to produce distilled water as well as heat and fruits. The project contemplates the development of two prototypes: one application for arid climates in Southern Europe with an emphasis on water production in the context of greenhouse horticulture, and another for temperate Central European climate focused on heat and water production for sustainable architecture.