Hi rnln, I have a gas tankless water heater in my SoCal house. I have mixed feelings about it after a couple of years of ownership.
You'll probably want to get a gas unit instead of electric for more cost effective heating. The gas units need to be vented to the outside, and they need a very special flue. The flue on your current hot water tank is not sufficient. Their gas requirements may require your gas supply piping to your tankless heater to be increased in size from what you currently have. Speaking of size, make sure you have a unit that can more than meet all household needs at the same time (personal opinion).
The tankless water heaters bring the water temperature up fairly quickly; however, the water in the pipes between your tankless heater and where you're using the water are initially full of cold water. That creates a time lag to get hot water. It's nicer to have the tankless heater located closer to where you're using hot water. Showers and running the clothes washing machine are no problem after the initial lag. Where it's more of an issue is the sinks. On/Off and low demand may not keep the water flow through the tankless heater at a high enough level to stay on and heat the water coming to the sink. Apparently, there's a possibility to make this less problematic by implementing a recirculating system with the tankless heater. I don't know enough of the details to explain it here, but some of the other guys like
look 171 should be able to fill you in. My plumbing system has some lines stubbed in to add a recirculating system one of these days.
We are currently only at our SoCal house a week or two at a time, a few times/year until we retire. So, our use for hot water is only limited to those times. It saves us a noticeable amount of money on our gas bill, as compared to the old conventional hot water heater we had. Even after we retire, we should still see savings over the old system. And, when we travel, our gas consumption will drop back to practically nothing during those times.
I hope this helps you in your research on this, rnln.
