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Hot water tank insulation

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Advice appreciated - how far can one go with insulating hot water tank and pipes in the airing cupboard? The cupboard is directly underneath the (insulated) cold tank in the roof space (we have a bungalow) and the small bit of loft floor above the cupboard is left free of roof insulation in order that warmth from the cupboard rises to help with the frost precautions. The hot tank has a built in foam jacket about 24mm thick and none of the pipes in the cupboard are insulated (all in the loft are). Should I improve the insulation of the tank and pipes even though, it seems to me, this works against their role as a heat source for the cold tank above (and for airing the clothes).
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