A tankless water heater, often referred to as an “on-demand” water heater, is a device that heats water instantly as it flows through the unit, without the need for a storage tank. When a hot water tap is opened, cold water travels through a pipe into the unit where a gas burner or an electric element heats the water. This ensures that hot water is available whenever required, eliminating the waiting time and the energy losses associated with traditional tank-based heaters.