The Heater is an Arctic building that works much like the Oil Power Plant. It will consume fuel in the form of coal and instead of turning it into another product, will provide a public service that spreads out from the Heater as influence, across the adjacent network of roads. The Heater's range of influence is visually depicted as a network of pipes running across the middle of the affected roads (see picture).
Any Arctic building touching the Heater's range of influence and these pipes, is counted as being "heated". With the exception of the Arctic version of the Charcoal Kiln - which can heat itself - all Arctic Buildings need to be heated. Production Facilities cannot function without heating, and Residences have a Need for the Heater's output as one of several ways to stay warm in the Arctic (other than supplying your residents with goods such as comfy parkas, hot coffee and cozy sleeping bags).
In fact, the Heater is the single greatest source of warmth, producing 32 heat out of a maximum of 60 possible for residents in the arctic. This makes the Heater the best measure available for preventing virulent outbreaks of Arctic Flu. While the heater might not be strictly required for upgrading a player's settlements - since it does not fulfill a basic need - it does prevent the Arctic population from being sick, unavailable for work, and incapable of reaching the maximum occupancy necessary to evolve an Explorer's Residence to Technician Tier more often than not.
The Influence range of the Heater across an unbroken sequence of horizontally or vertically adjacent road tiles is 19. This range is absolute: Unlike other Public Services, its influence has no gradation and is always 100%, or nothing. Since roads in the Arctic cannot be paved and only come in the standard version, this range is always 19 tiles (not considering the use of items).