What Is an Indirect Water Heater?

When you’re planning a new space or upgrading your infrastructure, understanding your options is the first step toward success. If your home uses a boiler for heat, we want to introduce you to one of the most efficient, durable, and sophisticated solutions for domestic hot water: the indirect water heater.

How Does an Indirect Water Heater Work?

An indirect water heater, also known as an indirect-fired water heater, is a highly efficient storage tank that operates without its own dedicated burner or heating element. Instead, it smartly leverages a heat source that is already present in your home: your hot water boiler.

At its most basic, an indirect water heater is a storage tank with an internal heat exchanger coil.

1.   The Circulation: Hot water from your boiler circulates through the heat exchanger coil inside the tank.

2.   The Transfer: Heat transfers from the water in the coil to the domestic water surrounding it in the tank, which then flows to your fixtures.

3.   The Control: A thermostat monitors the temperature of the water in the tank and signals the boiler to activate only when domestic hot water is needed.

Essentially, an indirect water heater is an appliance that transforms an existing resource (your boiler’s energy) into a nearly limitless supply of hot water.

Benefits of Indirect Water Heaters

Choosing an indirect unit is a smart, integrated approach to water heating that offers several advantages over conventional or tankless systems, particularly when paired with a high-efficiency boiler.

Near-Perfect Efficiency

Because the indirect unit uses the high-efficiency output of a modern boiler and doesn't require its own separate flue or vent, it operates at near-perfect thermal efficiency. Unlike a conventional water heater that loses energy up a chimney, an indirect unit is a highly insulated storage tank that wastes virtually no heat.

Seasonal Cost Savings

This is where the genius of the system shines. During the colder months, your boiler is already running to heat your home. For six or more months of the year, the indirect-fired water heater is simply using that pre-existing, abundant energy as a secondary function. You are maximizing the output of one appliance, leading to noticeable utility savings.

Unmatched Durability

Indirect water tanks are built to last. Typically constructed from robust materials like stainless steel, these units contain no mechanical parts (such as gas valves or electric elements) that commonly fail in traditional water heaters. This inherent simplicity translates into exceptional longevity and reliability—often lasting for decades.

Indirect Water Heaters vs. Tankless Water Heaters

A tankless water heater is far more efficient than a conventional water heater. If a forced air furnace is used to heat the home instead of a hot water boiler, then a tankless water heater is the way to go. However, if a hot water boiler is present, adding a tankless water heater to handle domestic hot water is not the best solution.

Like a conventional water heater, a tankless water heater requires a separate gas line and even its own electricity source. In the wintertime, the boiler and tankless water heater will operate using two separate gas lines and electricity sources, making the system not as efficient as expected.

An indirect-fired water heater does not require electricity or gas and, therefore, does not need a vent. In fact, it’s nothing more than a storage tank with a coil inside and inlet and outlet taps (connection points).

Depending on your home’s specific hot water needs, it may turn out that two or more tankless water heaters are required. That is why an indirect water heater is the number one solution for domestic hot water when a boiler is present.

Find the Best Indirect Water Heater

Like any major home component, proper sizing is crucial. If you are replacing an existing unit that meets your family’s needs, matching its capacity is a straightforward choice. However, for new construction, extensive remodels, or when adding high-flow fixtures like custom showers or soaking tubs, it’s essential to factor in the total required gallons per minute (GPM).