A gas tankless water heater merits consideration. They can provide limitless hot water when properly sized. There is the benefit of only using gas when there is a call for hot water and not burning gas 24-7 to keep tanked water hot. Add in the space that is gained by removing the tank. Rinnai makes some excellent units. I have a tankless electric and love it. It was a bit of a witch to set up because it required 6/3 wire from the main panel to a subpanel along with a 100 amp breaker. Your current setup can be easily switched over to tankless with out the hassle that I went through.
