An example of heat exchanging is when you put your pot on the stove element. The heat from the element is exchanged to the pot, and then from the metal of the pot to the liquid in it.
The refrigerator in your home has a heat exchanger too. It is usually located on the outside back wall of the cabinet. The heat that is being pumped out of your fridge travels through the intricate web of lines on the back of the fridge cabinet, and with the abundance of surface area of those lines, heat from within your fridge is exchanged with the cooler air surrounding the fridge. It is a good idea to look behind the fridge periodically, and if the back is covered with dust, vacuum it off. Your fridge will work less hard, and that will cut down a bit on your energy bill.
The radiator in your car is a heat exchanger too. The hot coolant from your engine is pumped through the lines in the radiator, and as air passes through and around the fins of the rad, heat is exchanged, the liquid within the lines of the rad is cooled, and is ready to go back to your engine to pick up more heat. And of course, the coolant heat exchanges within the engine block to cool the block down. Yet how does this apply to air compressors?
In our case, the fluid we are primarily concerned with is the compressed air exiting our compressor receiver and heading for the plant air mains and air tools, air valves, air motors, air pumps, etc. Compressed air is known as fluid power, hence my saying that air is a fluid.
The other fluid is a coolant, often surrounding the compressed air line in some types of heat exchangers.
The hot compressed air from the receiver is still carrying lots of water in vapou form.Here is why there is water in your compressed air and the receiver.
If the compressed air temperature is not lowered down past the dew point of the air, preferably before the air gets to the mains and the drop lines, then the compressed air will continue to de-water in the air lines. The water vapor in the hot compressed air will continue to condense into water, creating free water in the air lines to flow down to your air tools, air valves, air motors etc. This is not good!
In the water jacket heat exchanger, the two fluids (compressed air and cool water) will be separated by the metal pipe of the air line.
Cold water will flow around the air pipe, drawing the heat from the hot compressed air inside the pipe, and heat exchange will take place.
The heat exchanger must have a surface area large enough - or the dwell time of the two fluids in the exchanger is long enough - for sufficient heat to be transferred from the hot compressed air to the cold water.
Sizing your heat exchanger for the air consumption in your plant is very important. A too small heat exchanger will de-water the compressed air, but never enough to thoroughly cool the compressed air to allow maximum de-watering.
With this information, your heat exchanger vendor should be able to help you determine the size you need.
If you wish more details on the science of heat exchanging, Google the following topics: