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A Fan Coil Unit (FCU) is a simple device consisting of a heating and/or cooling heat exchanger or 'coil' and fan. It is part of an HVAC system found in residential, commercial, and industrial buildings. A fan coil unit is a diverse device sometimes using ductwork, and is used to control the temperature in the space where it is installed, or serve multiple spaces.
The hot water is used to heat the fan coils for your home heating system, and the heat is then distributed through ducts, as with a standard furnace. This type of system requires a high-efficiency water heater and fan coil. It can work if you need less than 75,000 Btu/h of heating capacity for your house.