You are so right on the money. This why if you have an old unit, get your service man to DYE CHECK it every so often. For manifold (heat exchanger) cracks, dye checks are the only way to "see" that problem before it kills you.
They basically use the hot exhaust from combustion to pre-heat the incoming air, so less heat actually heads up the chimney.
In Japan, we used kerosene heaters with fans. The exhaust/intake pipe was just as you described. The intake was inside the exhaust. Incoming air was preheated this way, and made a very real difference in the quality of heat you brought in.
“In Japan, we used kerosene heaters with fans. The exhaust/intake pipe was just as you described. The intake was inside the exhaust.”
Yea, that does work. Anyone who’s a real man has wondered why the exhaust pipes for furnaces and water heaters has to be so darn hot - it only seems logical to us real men that something could be done to capture that heat.
But....now to water heaters. If you have a conventional natural gas water heater, take a look - no electrical connections, none. But buy a condensing water heater (same principal as these furnaces) and you now need 120 VAC for hot water (to power an exhaust fan, and maybe electronics). That’s all fine when you’ve got power...but not everyone has power 24/7/365...we certainly don’t.
But - to Obama’s credit, he hasn’t (yet) required condensing water heaters (they tried...but not yet required). The moment he does, if he does, I go out and buy at least 2 more of the old type (I already have a spare as it is).