If you are considering a hot water recirculating system be aware that here are a number of systems that should be analyzed to fit your needs and where you would like to conserve. The benefits of hot water recirculation are rather obvious. You get nearly instant hot water which is convenient, and you save a substantial amount of water.
There are a number of types of recirculation systems for residential plumbing. There are the traditional full-time circulating systems that continuously pump a small flow of hot water through the piping, warm water recirculating pumps and on demand hot water pumps. The traditional recirculating system provides instant hot water while saving water although this will increase your gas and electric consumption. Warm water systems circulate only warm water through your pipes which will reduce your water consumption and allowing for speedier access (not instant) to hot water. The drawback for this type of system is that you will have warm water in your pipes and if you desire cold drinking water you will waste water while waiting for it to cool down.
The most energy efficient type of recirculating system is the hot water demand system. The demand system pump only operates when you desire hot water. When you push the start button, or activate it with some other means such as a motion detector, the pump comes on and speeds the heated water to your fixture, sending the cooled off water from the previous use back to the heater through the cold water piping.
Because the water flow is very low on recirculation pumps, usually not enough to turn on a tankless water heater, tankless heaters require more time than a storage type heater to provide heated water to the fixtures.
For more detailed information from the National Association of Homebuilders on recirculating systems click here.