Pick a water heater that runs out during the morning rush and you will get complaints; oversize it and you waste money and energy. This calculator sizes both storage and tankless heaters the right way — storage by first-hour rating from your peak-hour demand, tankless by flow rate at the real temperature rise.
How it works
The two heater types are sized on completely different principles:
Storage: peak-hour demand = sum of hot-water events × gallons each
choose a heater whose First-Hour Rating ≥ that demand
Tankless: required GPM = sum of simultaneous fixture hot flows
temperature rise = target (120 F) − groundwater temp
energy needed = GPM × 60 × 8.33 × ΔT (BTU/h)
Storage cares about the busiest single hour; tankless cares about the worst-case simultaneous flow and how cold your incoming water is.
Example and notes
Two back-to-back showers (10 gal each) plus a dishwasher (6 gal) in one hour give 26 gallons of peak demand, so you want a heater with an FHR of at least 26 — a 40-gallon storage tank usually qualifies. On the tankless side, a shower plus a kitchen sink at a 70 F rise needs roughly 3.5 GPM and about 122,000 BTU/h of heat absorbed, so look for a unit rated for that GPM at that exact rise. Remember recovery and rise curves, not headline numbers, decide whether you ever run cold.