Above is an illustration of the Munchkin all stainless steel heat exchanger which shows how the 92% AFUE system works. The burner is located in the center of the stainless steel heat exchanger tubes which transfer the heated energy from the flame directly into the primary combustion chamber. From there, the cooled gases are diverted to the secondary section of the heat exchanger to extract the remaining energy out of the gases before exiting the heat exchanger. Condensation forms in the back section where the last remaining levels of energy are absorbed into the secondary section. The Munchkin extracts so much of the heated energy that the 2000 degree heated gas exits the Munchkin all stainless steel heat exchanger at 120 degrees, which allows the system to be vented in plastic PVC piping! This is why the Munchkin pays for itself after two to three years of operation. The Munchkin keeps money in your pocket versus traditional systems as energy costs continue to increase.