This water heater is fueled by natural gas and only heats when needed at a rate of about 4 gallons per minute. When it is not needed, the gas valve is automatically closed and the burners are turned off. This water heater is sure to save you up to 50% on water heating costs. Because of its small size, the water heater can be placed on a wall or stored away in a closet with the hooks that come with it.