I plan to install a Waterfurnace Optiheat NEW050 to heat & cool my home. My 1911 house in Montréal has cast iron radiators, and I plan to add a few fan coils for extra heat control and cooling. The Optiheat does not have a desuperheater circuit since it uses vapor injection to generate higher temperature water (145 F) suited for radiators.

Given the setup, I am wondering what is the best way to heat my domestic water. See attached drawing.

1. Use an indirect heating domestic  hot water tank, with an auxiliary electric element. The benefit is a lower number of tanks, and that the geo system maintains water temp even if there is no demand. However, we have to make sure the GSHP is not connected if its output is below the desired water temp.

2. We use a heat-only buffer tank with a heat exchange to pre-heat the cold domestic water before feeding it to a standard electric water tank, which acts as a finishing tank. This requires one extra tank, and there will always be standby electric power usage to maintain temperature.

3. Like B), but we forego the finishing tank completely and assume the buffer tank temperature and heat exchanger are such that we can heat up enough water on-the-fly.

Anybody have experience on whether any of these systems can or cannot work in real life?

A concern I have is that in summer time, the second heat/cold buffer tank is kept cold for the fan coils,  so the GSHP has to switch between heating and cooling mode to provide both hot water and cool the house. How often is is allowed to switch between mode in a day before this impacts the lifetime of the compressor or switchover valve?

Thanks for your insight!