Hybrid water heaters combine demand water heating technology with a small storage tank. Hybrids are said to provide instant hot water for small loads and consistent temperatures for continuous demands, eliminating the waste associated with conventional storage heaters—namely, letting cool water go down the drain while waiting for hot water from a centrally located tank to reach a faucet, and standby losses from keeping water in the tank hot. Alex Wilson, founder of Building Green, Inc., looks at two hybrid models in a recent blog post: Grand Hall’s Eternal Hybrid and A.O. Smith’s NEXT Hybrid. Both are gas-fired tankless water heaters that have a small buffer tank, which is kept hot. Both use condensing combustion technology to exceed 90% efficiency.
Wilson provides some details on the available sizes, Btu ratings, supply and venting requirements for both brands. He asserts that while hybrid water heaters appear to have some performance advantages over conventional tankless water heaters, he calls their prices an "Achilles’ heel." “Whether they will make economic sense over conventional gas storage water heaters,” Wilson writes, “will depend on the situation and usage habits.”