If you have a boiler heating your home, you have a choice for domestic hot water: keep the standalone water heater you have now, OR replace it with an indirect-fired storage tank (like the Lochinvar SQUIRE) that\'s heated by your existing boiler. The math usually favors indirect — but not always.
How they work
Standard tank (Rheem / AO Smith / Bradford White)
Self-contained appliance: tank + burner + flue. Burns gas to heat the water sitting in the tank. Standby losses when not in use. Recovery rate limited by burner size (40-50k BTU residential).
Indirect-fired tank (Lochinvar SQUIRE)
Storage tank with internal heat exchanger coil but no burner. Hot boiler water circulates through the coil; heat transfers to the domestic water in the tank. No second flue, no second gas line. Boiler does both space heating and DHW heating.
Where indirect wins
| Indirect (SQUIRE) | Standalone tank | |
|---|---|---|
| Efficiency in heating season | Same as boiler (90%+ on mod-con) | 62-65% on atmospheric gas |
| Recovery rate (50-gal equivalent) | ~180 GPH (boiler-limited) | ~40 GPH |
| Tank lifespan | 15-25 years (glass) / 25-35 years (stainless) | 8-12 years |
| Maintenance cost | Minimal — folded into boiler service | Annual flush, anode every 4-5 yrs |
| No second flue | Yes — uses boiler\'s vent | Needs its own flue |
| No second gas line | Yes — uses boiler\'s gas supply | Needs gas connection |
Where standalone tank wins
- Off-season (summer): running a boiler exclusively for DHW costs more than running a standalone gas tank. Boilers are sized for heat load (60-120k BTU) but DHW only needs 40-50k BTU input — boiler cycles inefficiently when only doing DHW
- Boiler is old/inefficient: if your boiler is 70% efficiency, indirect inherits that low efficiency. A new 80% atmospheric tank may net higher year-round efficiency
- Boiler can\'t spare BTU capacity: indirect adds DHW load to a boiler designed only for heat. If the boiler is already at maximum sizing for the home, no spare
- Considering removing the boiler eventually — don\'t commit to indirect if you plan to switch to heat pump heating in 5 years
- IRA tax credit on DHW: heat pump water heater (AWHP, Rheem ProTerra) gets $2,000 federal credit; indirect doesn\'t
The hybrid case for AWHP heat pump
For boiler-heated homes wanting to keep DHW separate from the boiler (for tax credit, summer efficiency, or future-proofing), the Lochinvar AWHP heat pump is the modern answer. Higher upfront cost than a standard gas tank, but:
- 4.0 UEF — beats indirect in summer-only operation
- $2,000 IRA federal tax credit (Section 25C)
- State/utility rebates stack
- Boiler-independent — DHW runs even when boiler is off for maintenance
Cost comparison (installed)
| Setup | Equipment | Install | Total |
|---|---|---|---|
| 50-gal Rheem Performance gas tank | $799-999 | $300-500 | $1,100-1,500 |
| 65-gal SQUIRE SIT065 indirect (boiler already in place) | $1,399-1,799 | $600-1,000 | $2,000-2,800 |
| 50-gal AWHP heat pump | $1,799-2,199 | $500-900 | $2,300-3,100 (before $2,000 IRA credit) |
Decision logic
- You have a boiler & the boiler is mod-con (90%+): SQUIRE indirect is optimal heating-season
- You have a boiler but it\'s atmospheric (70-80%): consider switching to AWHP heat pump for DHW; reserve the boiler for heat
- You have a boiler but plan to switch to heat pump in 5 years: AWHP heat pump now
- You don\'t have a boiler: indirect isn\'t the option; choose standard tank, heat pump, or combi
- You\'re replacing both boiler & water heater: consider a NOBLE/KNIGHT combi (one unit, two jobs)
Bottom line
For mod-con boiler homes in cold-climate states with long heating seasons, SQUIRE indirect is often the most efficient DHW setup. For boiler homes wanting IRA tax credit dollars and boiler-independent DHW, AWHP heat pump wins. For homes without boilers, indirect isn\'t in the conversation.