You have a leaking T&P Valve or, one that doesn’t open when you lift the test lever. If it is leaking, you have checked the related article “How to Test your T&P Valve” and made sure that it was not opening because it was doing its job. Now it is time to remove and replace the malfunctioning valve. At a minimum you will need a large adjustable wrench, Teflon tape, and Teflon Pipe Dope to do this job. If the discharge pipe is connected in a manner where you cannot turn it to unscrew it from the T&P Valve you will also need a tubing cutter like the one pictured, a repair coupling, plumber’s cloth, flux, lead free solder and a torch. I usually use a handheld torch using Map-Pro gas for fuel but propane will also work fine. If you do not know how to sweat a pipe this is a very forgiving application to learn on or, you can also use a “Sharkbite” coupling to rejoin the pipe afterwards.
To get ready to replace the T&P Valve you will need to shut off the water supply to the water heater and shut off whatever is used to heat the water so it does not try to reheat while you are working. You will also have to drain the water heater tank down so that the water level is at least below the level of the T&P Valve. The next step is to disconnect the discharge tube from the T&P Valve. The discharge tube is threaded into the valve and it should easily come out using the wrench. Again if the tube is run in a manner where it cannot swing to unscrew the tube will have to be cut. After disconnecting the tube, the T&P Valve is also threaded into the water heater tank. It should have a flat surface where the wrench can fit to turn the valve. Some brands of T&P Valves have only one flat surface but not to worry the adjustable wrench still will work. Turn the T&P Valve counterclockwise to remove it.
Once the new T&P Valve has been taped and doped you can the screw it into the tank. Turn it clockwise to screw it in. As it tightens up you have to gauge where the outlet is going to land so that it lines up properly with the discharge pipe. You have to be careful where you stop turning it so you get a leak free connection and you also have to stop where it lines up properly with the discharge pipe. To loose and it will leak, and too tight you will be left with the valve facing the wrong direction without being able to continue turning all the way around to the correct position. You cannot just loosen it backwards into the right position without getting a leak. If you go too far you will need to take it back out and apply Teflon tape and dope the threads. Many times I get it close to the right position then put in the drain tube and turn it the rest of the way into perfect alignment.
Once the T&P valve has been threaded into position you are ready to install the drain tube. The drain tube has some specific requirements for where it drains to that may have changed since the water heater was initially installed. It is in your best interest to upgrade to the code used in your area. Either research the code and amendments used in your area or, just ask the plumbing inspector what the requirements are.
Where I live the code states:
1.) The outlet of the T&P Valve cannot be directly connected to the drainage system. There must be an air gap where it connects to the drain system so that contaminants from the drain cannot be sucked back into the potable water if the water supply were to have a negative pressure.
2.) The T&P valve discharge tube will be full size which means if the outlet on the T&P Valve is ¾” the tube and all connectors used will be 3/4” I.D. The outlet cannot be restricted.
3.) The discharge from the tube must discharge to a safe place such as the floor, outside the building, or an indirect waste receptor.
4.) The discharge tube cannot have any trapped sections meaning the tube must maintain a downward pitch so that it drains completely dry.
5.) The discharge tube needs to have a visible air gap or air gap fitting located in the same room as the water heater.
6.) The outlet end of the discharge tube cannot be threaded and the discharge tube cannot have a valve between the T&P Valve and the disposal point. What this means is there cannot be any easy means of capping the discharge of the T&P Valve. If the valve opens it needs to flow freely to prevent an explosion of the water heater.
7.) The T&P Valve discharge tube needs to be installed in a manner that does not cause personal injury to occupants in the immediate area or, structural damage to the building. In other words hot water blasting out of the discharge tube cannot go to a place where it will hit people, and the flooding from it cannot damage the building.
I would anticipate the code in your area having similar requirements. Again check to see what the code requirements are where you live. There is not one code that covers the whole United States or even most states. Codes can even have amendments at the local level.
Once the discharge tube has been installed you can turn the water to the heater back on and run hot faucets to bleed the air out of the tank and allow it to refill. If the flow slows at any of the faucets remove the aerator from the faucet and clean out any debris. Check the connection where the T&P Valve threaded into the water heater for leaks. Then turn back on whatever is used to heat the water and once hot again recheck for leaks at the connection of the T&P Valve and the water heater.