Describes the ASHRAE Award-winning renovation of the boiler room serving Hopital du Sacre-Coeur, a 700-bed major hospital in Montreal, Quebec. Describes the many problems with the old plant and sets out the design criteria for the replacement equipment. Lists the equipment installed and describes the incorporation of a direct-contact water heater and a direct-contact condensing stack economiser. Summarises annual savings for supervision, energy and maintenance, giving a simple payback period of 4.5 years.