I am getting ready to finish our basement, which includes replacing our old hot water heater and moving it to a more logical location in the basement. The house was built in 2005 I have installed water heaters in the past, although I have never seen a hook up like this. I am not sure why there are two cold lines one for the 1st floor and one for the 2nd floor tied in like this.
Here is a picture of the new one, more logical location next to the sump instead of the middle of the room with an actual expansion tank