NO! This is a FIRE HAZARD. Manufacturers of all water heaters always install insulation around the tank then cover it with the sheet metal jacket. I have seen many times where a person has insulated a gas water heater and the flames from the burner chamber escaped from the cover and ignited the plastic on the insulation blanket.
Source: Me, a Master Plumber.
I am looking for plumbing solutions. Where can I find gas water heaters to help with this?
Tankless water heaters can be powered by electricity or propane. Electric tankless water heaters are more common, but propane tankless water heaters are popular in regions where natural gas is not available. Both types offer energy efficiency and the convenience of on-demand hot water.
Hybrid gas water heaters offer benefits such as higher energy efficiency, cost savings on utility bills, and reduced environmental impact compared to traditional gas or electric water heaters.
Gas water heaters are internally insulated, and need air flow to burn the gas off safely and correctly. There is no need to insulate them, in fact it would be very wrong to do so. Simply put pipe insulation on the exposed copper. Home depot has it in the plumbing section. Electric water heaters are different, and you can insulate them with a fitted sleeve sold at plumbing part shops, or most large hardware stores. be sure to insulate the copper as well.
"Rheem does manufacture both gas and electric water heaters. Rheem currently offers 18 different varieties of gas water heaters and 9 different varieties of electric water heaters. Both types of Rheem water heaters are known for their rigorous standards, reliability, and efficiency."
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Rheem provide a series of high efficiency gas water heaters. Several different companies also provide tank-less water heaters, which are very efficient, as well as solar water heaters.
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by California code gas fired water heaters must be 18inches off the garage floor & must have earthquake straps
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Gas water heaters are better than electric water heaters. Although they are not exactly or completely environmentally healthy, they do save you a lot more money and heat up much better.
One of the advantages of electric heaters over gas heaters is convenience. All homes are equipped with electricity, but not all homes have gas. But there are a variety of types of heaters, such as space heaters, hot water heaters, or furnaces. With electric heaters, there is no risk of becoming overcome with fumes.