I have been looking at some of my "bozo" electrical photos today -- compilations from a number of my inspections. This is not an uncommon scenario. In this case, someone removed the 240 volt circuit from the water heater and just left the energized wires hanging there with a couple wire nuts on them. An inquisitive kid could be killed here as each wire, referenced to ground, which the tank was at by being hooked into the metal water pipes, would deliver 120 volts. If both nuts were off, the two hot wires would deliver the full 240 volts. While this situation was odd, it is not at all uncommon to find electric hot water tanks where the 240 volts is still hooked to the tank wiring but the connections are made with wire nuts and no door is in place to protect the inquisitive from live wires under the easily removable wire nuts.
Thanks for looking.
Steven L. Smith
Bellingham Home Inspector