A heat transfer system includes a water line for carrying water having a first predetermined flow direction and a refrigerant line for carrying a refrigerant and having a second predetermined flow direction opposite the first predetermined flow direction. The heat transfer system includes a refrigerant evaporator, a vapor compressor, a condenser, and an expansion device. Refrigerant is passed through the refrigerant evaporator as a liquid and is warmed to a cooled gas. The refrigerant is heated to a superheated gas in the vapor compressor, and cooled to a warm liquid in the condenser. The refrigerant is cooled to a bi-phase liquid in the expansion device and is then passed to the refrigerant evaporator. Water enters the refrigerant condenser and heat is exchanged between the refrigerant and the water to warm the water to a predetermined water temperature. The water exits the refrigerant condenser and is passed to the water storage member at a predetermined temperature.