Even with geothermal, hot water ain't free! I haven't tried turning off the breaker to our wired tank this summer to see how the desuperheater does on its own. We have two 80-gal stonelined tanks, first is "preheated" (in the summer) by the heat pump taking heat out of the house, the second is electric and set to 120F. We're trying to get guy out for a quote on solar. As far as what's needed, I'd say an 80gal would serve your needs now and in the future, unless you want a separate tank for MIL b/c you're going to have her suite on a separate meter. Our last house was tankless. You may want to consider that for the bathrooms and a small (40gal?) tank for the rest of the house, but I'd go with the small modern units rather than the old style oil boiler (also used for heat) that we had. When you have kids, let's hope they don't take after your MIL. 15 min is plenty long enough for me and DH (separately - if we had a large shower with dual heads then it would still be 15-20 min so same as taking turns using 1 shower). But my kids turn it as hot as it can go and would stay in as long as your MIL if we let them! At least they only shower 2-3x/wk, but they're not teens yet... I grew up in a family of 6 with 40gal tank and a well, my dad yelled if we took longer than 5 min *and* we were supposed to get wet, turn the water off, soap up, rinse off and get out within that time so water wasn't even running the whole 5 minutes. Not only did we often run out of hot water (lots of laundry), sometimes we ran out of water period, and my parents still do if they're not careful when my siblings and their families come to visit. DH grew up in a family of 11 with 1 bathroom (not sure how big a tank) *and* was in the Army so he takes 5-10 min showers.

Your 60K btu heater probably has a one hour recovery (cold water to ~120 deg) of at least 50 gallons, maybe a bit more. (It should say so on the tank). That being the case, 120 to 140 would probably take 20 minutes or less. I agree that the higher temp setting with what you have solves the problem but the higher temp setting will also accelerate the death of the heater. If it's 20 years old, replacing it anytime now would probably not be too soon if you want to avoid leak damage. If you get the 37K btu heater, plan on having cool water in the hot pipes for at least 30 minutes or more after filling the bath or taking a long shower.

My main uncertainty at this point is what to use as the intake water temperature. The plumber that came today said I could figure 60 degrees F for Sacramento in winter which sounds high to me. I was expecting something between 40 and 50 degrees - our pond gets to 40 degrees in the winter but perhaps the water pipes underground don't get quite as cold as that. If winter water temp was 55 or higher, then 105 takes a 50 degree rise. The Noritz 751 would supply 6.7 GPM at that temp rise which sounds like plenty for this situation. On the other hand, if intake water temp goes down to 40, the temp rise would be 65; the Noritz would only supply 5.2 GPM which seems marginal to me (though its enough for the two showers). The alterantive would be to use the Noritz 841 but that only increases the output at 65 rise to 5.8 and it costs a lot more - list price is about $1K more but I haven't gotten price quotes yet. Also haven't seen prices on the other brands yet. The Noritz 841 is condensing, but since we only need a straight vent run of about 10 feet, I doubt that PVC will save us much over stainless. In this case, there are no appliances drawing from this water heater. There is another water heater that services the kitchen, utility room and other baths. The big tub just has a regular tub spout that does about 5 GPM but the tub is tiled so it has a lot of heat mass so filling it one uses mainly hot water to end up with a hot bath after the tile has taken heat out of the water. If we run the water heater at 105 or 110 degrees, the tub would probably be filled with just hot water going in.

drtechno, How cold is the water at the coldest part of the year? If it is 35-40 degrees (I've seen mine get near 32) then a 70 degree rise would bring it to 105-110...not 120 On a tankless, you assume a shower temp of 105 as if the tankless was outputting 105 degree water and forget about mixing. So, a 200k btu/h tankless could heat ~5 gpm from 40 - 110 degrees (which would give you a little extra for heat loss in the pipes and the option to run more than 105 if you like hotter showers) which is enough to run two standard showers, but not your 7 gpm master shower... and certainly not all three. The reason that you don't worry about mixing ratios on a tankless is because you aren't storing any water. On a tank system, it makes sense to store 40 gal of 140 degree water and mix it down to 105. There's no benefit to doing this on a tankless. Some of them even have bathroom controls so you can set your shower all the way to HOT and then set the water heater to output the exact temp you want. In practice, you generally set a tankless to 120 or so for the dishwasher and washing machine - but it doesn't change the capacity of the heater. You are running less water through the heater, but it's at a higher temp rise so the math is the same.