Water heaters come in several shapes and sizes. They can hold water in a reservoir or heat it only when needed, from your basement or from right under the sink. They can also be powered by a variety of sources, including gas or electric water heaters, your current home heating system or even the sun.
Storage water heaters
These are the most common type of water heater used in North America. They are generally the cheapest initially, although storage water heaters can also be the least efficient and cost the most to run. Sizing ranges from 20 to 80 gallons or more, and they can run on electricity, solar power, natural gas, oil or propane. An insulated tank holds, heats, and disperses the water.
Demand (tankless) water heaters
Demand water heaters go to work when there's an immediate need for hot water. Their popularity is growing steadily as they become known for energy efficiency (standby loss from storage tanks is eliminated). tankless water heaters do have some drawbacks, including inadequate capacity for simultaneous uses and expensive installation, but they may also be eligible for tax credits.
Point-of-use (POU) water heaters
These ultra-compact units can fit under sinks and are great for providing hot water to locations far from the household water heater or where pipes can't easily be directed. The water has less distance to travel, which increases efficiency and allows almost instant hot water. However, POU water heaters are not adequate for moderate or heavy usage and they have a lot of limitations.
Other heater types