We recently upgraded our electric service...had to put in a new panel, etc. The city inspector came by and said that everything looked good except that we still need to "Bond Hot-Cold-Gas with #6" @ the water heater. My question is why do we need to do that?
Because your water heater has dielectric unions, so the hot and cold plumbing are isolated from each other. Bonding the plumbing, attempts to keep the hot and cold plumbing at the same electrical potential.
If this bond is not in place, it's possible for the hot and cold plumbing to be at different voltage potentials. Which means if you grab a hot and cold handle, you could complete a circuit.
It also allows the plumbing to act as an effective fault current path. So if wiring faults to the plumbing, a breaker will trip.
A jumper should be installed across any other break in the continuity as well, e.g. water meter, nonmetallic plumbing, etc.
The reason the hot and cold lines are jumped ( bonded ) at the hot water tank is to protect Mr. Plumber during future repair work.
The jumper protects the technician from becoming energized by improper current on the system ground by forcing the current to go through it.
Also, a jumper should be on the pressure reducer valve for the same reason.