The vent for the water heater and furnace (about 20 years old) in my daughter's house travels about 12 feet of 5" single wall pipe through the basement and then through the wall to a chimney. From looking at the connection at the wall, I think there is a flexible line up through the chimney. Previous owners did some finishing of the basement but left the area around the pipe open (see picture). Because of the age of the furnace she knows she will be replacing it with high efficiency in the next five years. She would like to finish off the wall, using a thimble or something similar to create a more finished look. I've been researching options, and I think code requires 6" to anything combustible. I can't find a thimble with any more than about 2" of clearance. If I replace with type b, could I replace just the angle and connection or would I have to go all the way back to the furnace or where the furnace and water heater vents join? Could I just cut a 5" hole in a 18x18 sheet of decorative aluminum and attach it to the wall?
She had an inspection earlier from a licensed HVAC person when she moved and he wasn't concerned about the current setup, but the more I research the more dangerous even the current setup looks to me. I don't want to start messing with it and make it dangerous.
Thanks for any and all help.