Woodbridge Environmental, an HVAC expert near Elizabeth, NJ, recommends installing a water softener in hard water areas if you are switching over to an on-demand hot water heater. In a post on Hometalk.com, he said, "Your water supply needs to be properly maintained. Meaning if you have hard water, you need to control this. As hard water will scale up inside the heat exchanger in no time lowering the ability of the system to work as it should. Part of the plumbing is lots of shut off valves with boiler drains so the system can be acid washed every few years to remove this hardness."