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@hippy
Don't think so. How else is it usually done? It seems stupid having a whole cupboard worth of electrical equipment and tanks just to warm the kitchen tap water.
Can you get smaller units for in-cupboard installation?
Would this kind of thing work?
http://www.alertelectrical.com/Water-Heating/Water-Heaters/Wijas-Perfect-35-35kw-Undersink-Water-Heater-PF35.asp