On-demand, tankless, or immediate water heaters heat water instantly when it is asked for, and so there is no requirement for a tank. On-demand water heaters are activated by the flow of water. When there is demand for hot water, a fuel valve opens, igniting the burner. Cold water gets in one side of a coil of copper pipe, which then turns with a heat exchanger that is surrounded by flame, and hot water exits the various other side of the heat exchanger.
The efficiency of an on-demand water heater is based on the heat transfer effectiveness of the heat exchanger and is 75 to 90 percent effective. One prospective issue is pressure drop across the heat exchanger which could produce lower flows when more then one source of hot water is utilized.
Tankless Water Heater Repair Long Beach offers the following information from the U.S. Department of Energy on tankless or demand type water heaters.