Disclosed is a water system that generates heated water and distilled water. The water system has a boiler configured to boil water to produce steam. The water system also has a condensing conduit to receive the steam, wherein thermal energy is removed to condense the steam into distilled water and to cool the distilled water. A heat exchanger is thermally coupled to the condensing conduit to remove a first portion of the thermal energy. The heat exchanger has a heating conduit configured to receive water and to heat the water using the first portion of the thermal energy to produce heated water. According to an embodiment of the disclosure, the water system also has a heat remover thermally coupled to the condensing conduit to remove a second portion of the thermal energy thereby cooling the distilled water in the condensing conduit.