Plumb the dump loop to your biodiesel processor. Why pay for heat when you have a convenient fusion reactor beaming power directly to your house?
Damn I've got to build one of these things. And the place I want the water heater is under the house. Sure, it'd put it outside of the insulated envelope, but where I live winters aren't that bad, and even if I wound up dumping some amps into it once in a while, it'd still be way ahead of dumping amps into it all the time. It'd also take it out of the air conditioned space, and that's more important to me.
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Lead or follow. Either is fine.
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