Abstract: A flue gas heat recovery apparatus is employed with a system of appliances such as a gas furnace and hot water heater, each having separate exhaust gas flues. The apparatus includes a gas-to-liquid heat exchanger in thermal communication with the two flues to simultaneously extract heat therefrom and a liquid-to-gas heat exchanger disposed within the furnace cold air return duct. A pump circulates water between the exchangers in response to a control signal to employ the recovered heat to preheat the cold air entering the furnace through the cold air return duct. A hysteretic control circuit monitors exhaust gas temperature and provides for system operation between high and low gas temperature limits. In the preferred embodiment of the invention, a furnace blower override feature is employed to energize the blower during periods of pump operation.