The heavy incinerator is essentially a napalm launcher; it lobs flammable fuel with a splash damage possibility at the target in an arc. These 'projectiles' cause splash damage, and will most often set the enemy on fire, unless a large 'miss' variance is registered. The heavy incinerator can be fired at extremely long distances with relatively good accuracy; it can even be effectively fired across the Potomac River to hit enemies on the other side.
Just having the heavy incinerator equipped is enough to ignite gas leaks because of the pilot light on the front of the weapon.
During the reloading animation, the small handles on the fuel tanks all start to turn and then stop when the weapon is loaded.
The fuel tanks on the sides are almost identical to flamer fuel canisters including the small handle on the top of the canisters, this proves that the incinerator fires bolts of fuel instead of lit canisters.
Behind the scenes
The appearance of the heavy incinerator is closer to that of the original flamer from Fallout than the flamer from Fallout 3.
PCPlayStation 3Xbox 360 In V.A.T.S. you fire 1-6 shots with every attack, but your ammunition will only be reduced by one, no matter how many shots were fired.
PC Using a Stealth Boy while having the heavy incinerator equipped will not hide the flame coming from the pilot light, generating a small graphics glitch.