Another vote for the Eternal hybrid gas unit. It has a small (two-gallon) tank that it keeps hot; that eliminates any "lag" when you turn on the tap. By the time that's gone, the unit can keep up. We have ours set at 130� and for a hot shower, the mix valve in the shower is right in the middle. We bought the unit sized for a family of four, with a thought to eventual sale of the house. We can run two showers and the dishwasher at the same time with no loss of hot water.
Cost to run? Our natural gas bill since we installed it in February has been $12 a month. The estimated cost sticker on the side of the unit says it will run for $192 a year and so far, we're a good bit under that. It has a 20-year full warranty.
I'll never consider having anything else.
