All of our drains in the house is tied into a single drain stack in the basement of the house, and a drain stack heat recovery coil was installed in the drain stack. A 6 foot section of 4″ copper pipe sits in the center to handle the waste water, and as the copper picks up the residual heat in the water, the heat transfers to the copper tubing that the incoming water flowing to the hot water tank, thereby preheating the cold municipal water as it enters the tank.
When hot water is being used in the house and drawn out of the hot water tank, replacement cold water effectively flows around the drain stack and picks up the heat from the returning waste hot water.