Is an Indirect Water Heater a Good Option?

When you need to replace your broken water heater, or when you’d like to upgrade your heating system to a more energy-efficient and higher-performing model, indirect water heaters are a good option for some and are definitely worth a look.

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Although indirect water heaters have been available since the 1970’s, they don’t seem to be well understood by the majority of homeowners, even after all this time. This derives from the fact that your furnace or boiler indirectly heats up these water heating systems.

An indirect water heater is also a good bet if you’re in search of one of the most energy-efficient water heating systems currently available, especially in colder climates. An indirect water heater, also referred to as a tankless coil water heater, uses the main boiler or furnace in your home to heat water.

This particular type of water heater is far more effective compared to other water heating systems, especially when paired with a high-efficiency furnace of a specified design. This type of water heating system is energy-efficient once installed. The stored energy means your furnace needs to be turned on less frequently.

How does an indirect water heater work?

Indirect water heaters use storage tanks in combination with heat from either your boiler or furnace to provide all the hot water required. Through piping, indirect water heaters connect to boilers. They circulate relatively hot water, usually between 180° and 200° F, from boilers to heat exchangers located within and attached to water heating units. The water then surrounds the heat exchanger’s coils to produce hot water.

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This heating process is in contrast to that of typical electric or gas water heaters, which heat up water using a heating element or flame from within. To provide high quantities of hot water, an indirect fired water heater employs the use of a finned copper tube coil in an entirely different approach.

To heat up the water, a plumbing loop circulates boiler hot water through a coil located at the bottom of the tank. The water heater then transfers the hot water into your storage tank, in the same fashion as a standard water heater, for storage in the same high temperatures until you need it for your domestic use.


If your home uses a furnace or boiler, be it gas, electric, propane, oil, or solar, then you have every reason to use an indirect water heater for your residential water heating needs. Some of the benefits afforded by this type of heating systems include:

High efficiency

Whenever you’re using a traditional furnace or boiler as your source of heat when it comes to heating your home’s water, the water heats up at the same efficiency as the boiler. While some high-efficiency boilers attain 96 percent, average gas water heaters are approximately between 60 and 70 percent efficient.

Reduced loss of heat

Indirect water heaters are extremely well insulated even without a water heater blanket. As such, they lose tiny amounts of heat in the long stand-by periods, either while you are away or at night. On the other hand, gas water heaters always lose energy up the flue.

High performance

The overall performance of indirect water heaters directly results from the boilers they connect to. It is therefore not unusual for indirect water heaters to produce up to three times the quantity of hot water standard gas water heaters produce, considering the sizes of most residential boilers.

Comparatively longer life

Most of the indirect water heaters available on the market feature a lifetime tank warranty, which means they will most likely be the last water heating system you will ever need installed.

Manufacturers usually offer the lifetime warranty safe in the knowledge that the tanks are almost never subjected to the same abuse as direct-fired gas water heaters. In addition to the lack of abuse, most tanks are of stainless steel, which ideally prevents corrosion.

Hot water storage

You can store hot water for high-volume flow-rate use whenever you need it given that these water heating systems come in a wide variety of sizes ranging from 30 to over 200 gallons.

Save money

By using space heaters to heat up water and air, indirect water heaters help you save money, particularly during the cooler months when your furnace usually runs continually. Indirect water heaters can additionally help you to save money during the summer, particularly for units that operate using solar power.

Combining a highly efficient furnace or boiler with a solar powered water heater offers ultimate potential when it comes to cost-saving measures. It allows for the enjoyment of the energy-efficiency provided by solar power and the constant hot water produced by a reliable heat source.

Can I install an indirect water heater myself?

While a do-it-yourself installation is possible, calling in a licensed plumber for this particular project is probably the best idea. Installing an indirect water heater requires extensive HVAC, plumbing, and electrical work experience.

Need to hire a plumber?
Get a free estimate online
from top local home service pros in your area.

Leaving it to the professionals ensures the performance of your newly installed energy-efficient water heater is optimal. That said, if you’ve previously installed a standard water heater with no problem and are the type of person who is not afraid of doing some online research or watching a good install video on Youtube, you’ll probably be fine.

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