Water heating technology hasn’t changed much over the years. The same principle of having a large tank of water that is heated up has been the standard for a very long time, but there is an option that offers significant benefits, as well as, offers savings on energy, and that is tankless water heaters. Tankless water heaters are often installed right by the faucet so that the water can be heated up on demand, but there is also the option of having one installed centrally, providing hot water for the whole building.
So why does this design improve on the efficiency of your water heater? If your water heater is installed right at the sink, you won’t lose heat from the pipes over the distance the water travels. You also eliminate the need for your water heater to constantly run to keep the water in the tank hot.
Another nice side effect is that you won’t experience sudden drops in the hot water supply if someone else opens a faucet.