The combustion air preheater is definitely one of heat exchanger applications. Based on Figure 1 below, flue gas simply leaves steam boiler and passes via air preheater. The combustion air is passed through this equipment too to increase its temperature before being combined with boiler fuel.
Because the temperature of combustion air is lower than the temperature of flue gas, combustion air receive heat transfer from flue gas through combustion air preheater in the process of convection heat transfer. The heat transfer make temperature of flue gas lower and consequently minimizes its heat loss and also decreases the air temperature to stack. The additional heat throughout the combustion air going into boiler furnace improves the process of combustion. This decreases the fuel need in quantity equivalent in the value of heat to quantity of heat which have been taken in the application of heat exchanger such as combustion air preheater, therefore increasing efficiency.
Through the utilization of air preheater application, about 1 % of fuel is unspent for every single 40 F go up in the temperature of combustion air.
Figure 1: Combustion Air Preheater
(Source: Book-Boiler Control System Engineering-G.F Gilman)