The noise is from the fan pushing air through the unit. You can’t sound insulate the air flow since it is not enclose-able. While the unit is actually heating the noise is minimal and the fan is running slowly. But before it lights and after it extinguishes the air flow/fan noise is huge. By the way I have a two year old GU32. IT has failed. The factory has been a pain in the keester. The first company I called to come out led me down the garden path for two weeks and even though the replacement had been authorized they had not ordered it yet. TWO YEARS into a 20 year warranty. That’s lame. So what else is there to know about the Eternal unit? Every time there is any fluctuation in water pressure, such as the sprinkler zone goes on or off it causes the Eternal to fire up. This wastes a lot of gas and is noisy. This thing fires up during the day to keep the little reservoir tank hot despite no one using any water. This wastes gas. I have been told by the plumber that this unit (The replacement 195) makes a lot of noise through the wall and should be mounted on the floor (actually on an 18″ stand) or you will be unhappy. This of course after he wanted to mount it on a wall and I told him how noisy the unit is and I didn’t want the noise telegraphing through the walls. When you get right down to it the most effective system would be to have a recirc line with a remote on/off. When hot water is needed you signal the recirc pump and cold water is pumped through the water heater. But the Eternal can’t be turned on and off by a switch. A demand flash heater would be the answer with a separate small and insulated storage tank. This would be a whole lot cheaper than an eternal, easier to service, and more efficient from a system stand point (which is what really matters.) Then you would get immediate hot water from the recirc line when you want it without wasting gas for unneeded operation. OH and one more thing about the new Eternal Models; they generate gallons of highly acidic condensate water every day. The plumber told me it will eat through concrete and cast iron pipes. I will need, in addition to my two year old installation, to have a neutralizing tank that needs service yearly and an expansion tank. This is starting to turn into a big ugly installation from what was supposed to be slick and elegant. For this much money how does it ever pay off? And what good is a 20 year warranty if the warranty replacement job costs you $1500 after two years? I would never do this again with Eternal.