The water heater has an automatic spring-loaded valve designed to vent pressure. This valve will prevent the water heater from exploding if the water boils. Located on either the top or side of the water heater, the pop-off valve doesn't look like an ordinary valve. It has no handle. When the spring in this valve loses tension, which it will with age, it allows water to pass through it.
Water can flow through the leaky valve either when it is heating or continuously running.
This wastes not only water, but also the energy needed to heat this water. If your water heater is hooked up properly, there is a pipe hooked to this pop-off valve which will direct the venting to an area where it will cause no harm. If your heater is in the house, this will be outside the house by the ground. There are two ways to check for the leak. Or you can find where the pipe opens to the outside and look for signs of a leak.