Condensation only occurs with cold water in the tank and a water heater is insulated so even that does not occur. The only condensation in a water heater is with a gas heater when the burner runs and the tank is cold and that condensation is evaporated by the heat of the burner. You have a leaking tank.: There is a small amount of water in the drain pan of the hot water heater. It appears to be less than 1 gallon a week as I bailed out the pan a week ago. I have watched the outside drain also and nothing seems to have come down since I cleared the pan. Is this amount normal for condensation? How can I tell for sure? If it is a leak, how really urgent is the replacement?
