Whenever you turn on a hot water faucet or have a hot shower, heated water is drawn from the top of the tank and is replaced by cold water that is carried to the bottom through the dip tube. When the water temperature drops, a thermostat activates a heat source – either a burner in a gas model or two heating elements in an electric model. A gas heater has a flue running up the center and out the top to vent deadly gasses. An electric heater needs no venting. In both, an anti-corrosion anode attracts corrosion that would otherwise attack the tank’s walls.