Alfine 11-speed - what is needed to install it? What are common problems when installing? This is an expensive and heavy hub but I'm looking to build a new wheel and strip the rear derailleur off my old Trek MTB. It already has a fixed Ritchey carbon fork and front disc and is a nice commuter, I just hate the grindy noise of a gritty derailleur so I want it gone to create a low maintenance wet weather bike. In the summer it's this, unmodified. Both bikes get a complete strip, clean and lube when they need it but I want to cut down on the time spend doing that - the IGH-carrying Trek will go out on wet days and the road bike in the sun.

I've googled plenty on this. There just aren't many pages up though, and none I can find that gives the whole fitting process. Shimano's PDF installation instructions are pretty dense and don't point out the important bits that a real person would need to know. I've read enough about performance to know it isn't perfect (and I would probably prefer a Rohloff) but it's going to solve my muddy, gritty bike path problem.

Buying it from an Australian store is pretty much out of the question given that it will easily cost hundreds more - importers gotta eat I guess but not at my expense and not at such a ridiculous markup. Sheldon Brown's pages, among others, have me keen to buy all the parts and build the wheel myself. Ordering all the parts is the time gate and failing to order something that later has to be sourced will lead to a frustrating wait of more weeks and paying an extra large shipping cost while another order is placed.

What I need to know is exactly what is required to fit the Alfine system to an existing bike. The hub is sold as one unit, the shifter another. The chain ring is sold separately too. Then there are one or two different small parts kits available which seem to be harder to get. 

What will I need to buy (part numbers if you know them)?

What parts will be troublesome to fit?

For those of you that have experience installing these: Have you used one of these hubs and did you go through the process of sourcing, fitting and adjusting this hub yourself? What did you improvise/overcome/improve during your fitting? When done did you feel you had done it perfectly? Compare the complexity of this task (Alfine system and adjustment) to a conventional derailleur...

edit: if what you are looking for is a grease-free solution for your belt-drive bike, these are not questions you should be asking. Alfie 11 hubs leak oil and make your belt just as greasy as a chain. I'm hearing from many people "mine too". One store tells me the extra tension on the sprocket when using a belt with this hub makes leaks all but inevitable. Shimano have had mine twice for extended periods for service and can't fix it. I am massively disappointed in this product, wish I had bought the 8-speed that uses grease rather than oil bath internally. 

2018 edit: Spot Acme still running nicely, but now with drop bars, TRP Hylex brakes, new wheels. I've given up worrying about the Alfine 11 leaking oil on the belt, it's inevitable.
I've not set up the Alfine 11 specifically, but it's quite similar to it's less-geared cousin.  You might also consider the Alfine 8 - it's rather cheaper and is a well-regarded hub with only slightly less total gear range.

In either case, the main things you'll need will be the hub (the SG-700-L is for disc and rim brakes), a 26"/559 rim of your choice, and spokes to match. In addition you'll need the Alfine 11 small parts kit, which includes the anti-rotation washers and other bits needed for installation. It's kind of annoying, really. 

Alfine hubs also don't include a cog, so you'll need to to select one. You can continue using your current crankset, using only one chainring.  The Alfine is rated for a ratio of 2:1, so a 16t cog would work well with your 32t middle chainring and give you a good range of 26" to 107". (107" is ~50kph at 100rpm cadence).  If you want to consider other gearing options, check out the Sheldon Brown IGH gear calculator. One note for installation, the Alfine has a fairly narrow chainline, so you'll probably want to line up with the middle ring. You can remove the inner and outer chainrings; replacing the outer with a simple bash ring / chain guard can be a nice touch.

As noted in other answers, you'll probably need a chain tensioner since your bike has vertical dropouts. The Alfine Chain Tensioner or the Rohloff Chain Tensioner are both rather good, basically just being derailleurs with stiff springs and no cable adjustment. If you feel like getting hacky, you might be able to succeed with a magic gear, especially if you're willing to do a little filing. Running the chain through a tensioner adds a little bit more drag and a little bit more slop than being able to tension it directly, but otherwise should be fine.

Lastly, since you've got flat bars, you'll want the Alfine SL-S700 rapidfire shifter.  Since you don't have the integrated shifter-lever pods, it should be a simple swap.

Installation should be fairly straightforward, since it's mostly removing stuff: extra chainrings, current derailleurs and shifters, rear wheel.  You'll install the wheel using the "vertical" antirotation washers (8R/8L, green &amp; blue), install the shifter and chain tensioner, run the chain and then cables and housing.  There's a bit of adjustment but the techdocs do make more sense when you have the hub in front of you - you're basically adjusting cable tension to line up the pair of yellow lines that mark the middle gear.

On the retail side, I'd recommend looking at some of the big German resellers - I've dealt with Starbike and Hibike and somehow they seem to undercut Shimano pricing pretty reliably (something about buying directly from Shimano Europe without a distributor? I don't entirely understand it); I just ordered a dynamo hub and it was cheaper including euro-shipping than I could get domestically in the US even from the deep discount sites online.