What is that small tank on top of your water heater?
That, friends, is a thermal expansion tank. You’ll remember from high school chemistry that water expands as it is heated. Because modern plumbing systems are closed-loop, this in effect makes the water heater a pressure vessel. The expansion tank is meant to absorb the pressure added due to thermal expansion and avoid an expensive plumbing system failure.
The expansion tank contains a rubberlike bladder or membrane which separates plumbing system water from a cushion of air. When thermal expansion occurs, water presses against the bladder and compresses the air cushion on the other side thus mitigating pressure buildup within the water heater. In other words, the combination of membrane and air acts like a spring – as pressure builds, it is absorbed by the spring (air cushion) and not the rest of the plumbing system. When a house faucet is opened, the now compressed spring (air) pushes the expansion tank water back into the pipes and the pressure is equalized.
When sized and installed correctly, the expansion tank minimizes excess pressure on the water heater and reduces the risk of failure. The problem is the bladder inside these tanks sometimes fail; pressure builds and something eventually gives. Depending on the water heater’s location, the damage can be extensive. The tiny hole in the tank pictured showered a home’s attic like a high-pressure hose. It soaked the home to its first floor before pressure was relieved. Fortunately, the owner was home at the time or entire floors could have been flooded.
The common way to test the expansion tank is to rap it with a metal object on both ends. Since a portion of the tank should hold water, the sound from one end should be dull while more like a “ting” from the other. A more determinant test is to remove the end cap and press (just for a second) the valve used to add air. The valve usually looks like the one you used to pump up your bicycle tire. You should hear a little air escape, but you should NOT see water.
Another sign that the expansion tank may have failed is the occasional release of water from the Pressure Relief Valve (PRV) on the top of the water heater. This valve is usually piped down to a pan beneath the unit. If there are signs the expansion tank is compromised or the PRV has opened, refer the problem to a licensed plumbing contractor for a complete evaluation.
Expansion tanks fail more often than the water heater itself. They should be inspected annually and, as a preventative measure, replaced every five years.
I hope this helps, but it represents all that I know. Refer to a licensed plumbing contractor for more information and evaluation/repair of your plumbing system.