Sounds like it is rusting on inside, you can flush it out at drain. Turn off water open drain and drain heater down all the way and turn on water and let it run till it clears up, if it gets rusty again then look into buying a new heater.
Does rusty water come out of all the fixtures or just one ? What kind of water lines do you have,copper or galvanized steel? I have never ran across a heater rusting from the insidein my 34 years of plumbing.Usually rust is a sign of a bad fitting or wrong fitting in a line,i.e.black fitting in a galvanized line.
If the water heater was rusting from inside,which is probably not the casell heaters are glassed lined.Buying a new heater would be the last thing to do until you check out the lines.Take a break Tired plbg.
» This message has been edited by oscar on 06 January 2003