Condensing boilers have been around for many years but it is only recently that they have become more common place in the domestic market; it is now a requirement that all replacement and new boilers have to be condensing high efficiency models. With the exception to some installations with back boilers for instance.
A condensing boiler is best described as an ordinary boiler with an extra heat exchanger or a larger exchanger. The usually wasted flue gasses that are several hundred degrees Celsius are sent to outside air and not used for anything other than venting the appliance of waste products.
A condensing boiler uses the heat from the flue gasses to preheat the water that passes back from the heating system before it passes through to the primary heat exchanger where it gets heated rapidly.
This is free and can reduce your fuel bill by up to 30% and it is also friendlier to the environment too by reducing your CO2 emissions and generally reducing your carbon footprint.
A bi-product of the condensing boiler is condensation, hence the name. This occurs when conditions are right within the boiler and when it is most efficient (condensing mode).
The condensate must be led away to a drain or soak away and is quite harmless; it is believed to be as acidic as cola.