This paper analyzes the local effectiveness of a baffled horizontal shell and one-path tube condenser along the condensation path, including leakage of air as a noncondensing gas. Condensation of steam occurs in the shell side, and cooling water flows through the tubes. A new formulation is developed for the maximum heat transfer rate between two streams in the heat exchanger, when one stream undergoes a condensation process. The effects of air mass flow rate, upstream cooling water, steam-air mixture temperatures, steam flow rate, and cooling water flow rate on the effectiveness along the exchanger are numerically investigated. The results lead to a new correlation for the thermal effectiveness as a function of upstream cooling water temperature, air mass flow rate, heat capacitance ratio, and dimensionless temperature, defined as the ratio of the cooling water temperature gradient to the difference between the condensation and inlet cooling water temperatures. Furthermore, an analytical expression is derived for the exergy efficiency of the system, which shows how irreversibilites characterized by the entropy generation number and environment temperature affect the second law efficiency. Typical results of this expression are compared with results from past numerical work. Close agreement between these comparisons provide useful validation of the current model.