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A hot water heater is a unit that converts energy to heat and transfers that warmth to water. It's connected to a cold water supply pipe, and has an outgoing hot water pipe, or system of pipes, that supplies heated water to the taps and appliances in your home.

Conventional vs. Tankless
A conventional water heater stores heated water in its tank. Tankless water heaters bypass the tank and route heated water straight to taps or appliances instead. Most water heaters are fueled by natural gas, although propane and electric water heaters are not unusual. Where natural gas is available, it is by far the most efficient fuel for heating the water in your home.

How Tankless Water Heaters Work
Tankless water heaters circulate water through a series of burners or electric coils when a hot water faucet or appliance is turned on. Because the hot water heater doesn't store hot water, it costs less to operate and doesn't run out of hot water unless the flow exceeds its heating ability. If two people take separate showers at the same time, a tankless unit may not be able to handle the flow. However, a discerning homeowner, aware of how tankless water heaters work, can save big money on water heating bills by carefully regulating the flow of hot water through the home. If you are unsure whether your hot water needs are compatible with a tankless model, it's well worth it to talk to a plumber or hot water heater supplier about whether a tankless unit can meet your needs.

Water Heater Maintenance and Tips
Regardless of whether you go with a traditional tank unit, or shift to a tankless model, you can take certain steps to optimize your hot water usage and save money. Lower the thermostat on the water heater to 120 degrees to save on heating costs and to prevent scalding. If you have children in the home, your water heater should never exceed the 120 degree limit to prevent serious injury. Small children don't understand the difference between hot and cold dials on tubs and sinks, so taking this important precaution can easily fend off trips to the emergency room if the unthinkable should happen.

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An alternative solution to this potential scalding problem is to install special cut-off valves in your showers and tubs that automatically cut the flow of water when there is a sudden increase in temperature beyond a reasonable amount.

Schedule Regular Maintenance Checkups
Finally, bring in a technician to perform a regular inspection on your hot water heater. Besides water temperature, it's very important that your hot water operates as efficiently as possible. Inefficient hot water heaters are a prime source of carbon dioxide poisoning, which can lead to illness and death. And if you've got the means, think about upgrading your hot water heater if it is at all possible. New Energy Star rated hot water heaters, tankless or otherwise, pay for themselves over time in energy savings, and are an easy way to help reduce energy consumption if you're concerned about your impact on the environment.

Matt Goering, formerly a carpenter and house painter, is a freelance writer for the home improvement industry who has published over 600 articles.

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