Green Hot Water Heaters
Hot water heaters, as we know them, are quickly becoming a thing of the past. The main change is the elimination of the tank and locating the heater near the need for hot water. The benefits are less hot water piping, less energy used because you don't keep a tank of water hot at all times, an endless supply of hot water when needed, and half the maintenance cost for the system. It is not uncommon for the annual cost of hot water to be 50% or less using this system. This style of tankless hot water heater is suitable for residential and commercial uses and for new or replacement / retrofit.
Here is how the system works. Instead of a tank of water kept hot in case you need it, you have what amounts to a mini-boiler ready to spring into action when needed. A tankless hot water heater can provide 5 to 10 gallons of 120 degree water per minute - and can keep it up for as long as needed.
These systems are green in several ways. First is the energy savings from only heating the water you use. Second is the savings in materials - the piping, the elimination of the tank, and the replacement of the heater every 20 years instead of 7 (unless you are luckier than I am).
Economically, it is an easy sell. Although the initial cost is roughly twice the cost of a natural gas hot water heater. The savings will make this a break-even in 4 to 5 years. Over its 20 year life expectancy, this system will cost less than half of the cost of the tank system.
The limitations are: 1) you need natural gas*; 2) the units must be vented; 3) the units are most effective if they are close to the hot water usage; 4) if you need a really large quantity of hot water in a short time, say showering the football team in fifteen minutes, then this isn't the way to go.
Rinnai, one of the popular brands has a helpful website at http://www.rinnai.us/tankless-water-heater
Another resource comparing several brands is Household Water Systems. You can find links to pricing here.
* My understanding is that natural gas is more economical to operate, but electric tankless water heaters are available.
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