The aim of this paper is to assess the effect of air gap between the vertical building applied PV-module and building envelope for reducing the module temperature and increasing the electrical conversion efficiency. To analysis fluid flow and heat transfer around PV-modules and to determine adequate air gap that is required to minimize PV overheating, Computational Fluid Dynamics simulation has been used. To set up the maximum PV overheating condition, high ambient air temperature and maximum solar irradiation on the vertical surface in In-cheon were considered. It has been found that the mean PV temperature decrease with increasing air gap and to reduce possible overheating of PV temperature requires a minimum air gap of 150mm for single module installation.