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We have an outdoor gas tankless heater. (Silicon Valley) Just the peace of mind of having an old rusty tank leaking in the basement (which the last one did) is worth it to me. The tankless works well, w/ about 1/2 a gallon of water before it gets hot on the 2nd floor shower. (Save this 1/2 gallon for the garden since we are currently in a water crunch.) In our case the gas lines from the main feed to the tankless is extremely short, which in earthquake country is a good think I reckon.
If your demand for hot water is minimal, it's an energy savings from not having to heat up a tank of water constantly. This is true one travels a lot.
I don't think I'd go back to a tank as I like the perceived convenience of a tankless water heater.
With that said, will someone like Nest create a "smart" water heater w/ an app for further energy savings?
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