[stevehull]

I agree with Randen on this - use a circulation pump. Your idea of using the point of use electric water heater is good, but the cost of the unit (at least $100 for the smallest 2 kW units) and the cost of using electricity will never be offset by using a natural gas water heater.

Using electricity to heat water, when natural gas is already at the house will never be an economical solution (unless you are Xringer and have extra solar PV kW to spare).

Alternatively, might I suggest using a tankless natural gas water heater? That way, you have the best of all worlds - no standing tank loss, use of inexpensive natural gas and a water heater that will last FAR longer than a tank type unit.

Steve