Tankless Water Heaters, sometimes called On demand heater, are becoming very common. They are very different from traditional insulated water tanks in several ways. A traditional heater has an insulated tank which holds about 40 gallons of water, This water heats and the thermostat holds the heat at the desired temperature. A tankless water heater has no tank, but rather allows cold water to enter the tank, only when you turn on your hot water valve. This water is quickly heated and comes out through your faucet. Some advantages of the tankless heater include saving water and electricity, thus being considered a ‘green’ system. There is no wait for the hot water to get to your faucet as there often is with a traditional heater.