plague Furnace firing into combat

The general principle regarding shooting into close combat, can be found on BRB p. 39: "Models are not permitted to shoot at enemies that are engaged in close combat, for the simple reason that there's too much danger of hitting a friend![...]

Some war machine weapons, particularly those that use templates, can accidentally hit friends whilst aiming at the enemy. The key word here is 'accidentally' — you cannot purposefully aim a template so that some of your models will be hit."

Since the normal Fire Thrower does not have a fixed range, there is always a risk that it will overshoot a target, and accidentally hit units in CC. Although The Plague Furnace uses the flame template, it cannot "accidentally" hit something that was not targeted, and, therefore, cannot fire into close combat (except if it involves Skaven Slaves).