Nanotechnology is a rapidly developing field with a wide range of potential applications. One such application is using nanoparticles to selectively absorb and transmit light. By controlling the material, size and shape of nanoparticles it is possible to achieve spectrally selective optical properties. This phenomena can be exploited in solar energy applications where selective absorption of the solar spectrum enables high efficient hybrid photovoltaic/thermal (PV/T) collectors. In this study, we suspend core-shell Ag-SiO2 nanoparticles in water to filter out the ideal spectrum for creating electricity from Si PV cells. A detailed optical and heat transfer model for this approach was developed and validated using the electric and thermal outputs from a prototype system operating in real outdoor conditions. The results of this experimental work indicates that 12% more value (weighted energy output) can be achieved from this PV/T prototype compared with a stand-alone PV system under the same illumination. Since the proposed system inherently decouples the thermal receiver from the PV cells, it is possible to extend this technology to industrial combined heat and power applications. (C) 2017 Elsevier Ltd. All rights reserved.