Hot water heating system comprising one or more water heaters with at least one water heating mechanism, and a heating-control storage tank generally configured to store heated water in a temperature stratified manner where hotter water tends to be separated from cold water. The heating-control storage tank can receive thermal energy or hot water from the water heater, send thermal energy or water to the water heater as its makeup water, and provide hot water directly to end users. The water heater may or may not be used to provide hot water to end users. The system is electronically controlled using a processor, various sensors, a recirculation pump, and electronically actuated valves. Depending on hot water needs and energy costs, the system controls water heating schedule and amount of hot water stored in the heating-control storage tank by changing system operation modes to minimize energy costs while providing reliable service.