It is generally caused by sediment buildup in the bottom of the tank. As you draw water, cooler water comes into the tank and the gas valve will turn on to heat it. As the gas valve heats the bottom of the tank water will get trapped in the sediment, superheat to the point that it becomes steam and then break free thru the sediment causing a banging noise. A simple test to verify this is to turn the thermostat on the gas valve all the way down to the lowest setting, draw water and verify that there is no noise. Return the gas valve thermostat to its original setting and in a short period of time the heat will start the noise again.
It is possible to flush the sediment from the tank, however a ten year old tank that has not been regularly flushed will have alot of buildup and will be labor intensive to clean. If this is the problem you might be better served replacing the tank or living with the noise.
» This message has been edited by turdchaser on 29 February 2004