If the water heater is being installed inside a single family residence (whether detached or attached to one other residence) or inside a townhouse unit, plan review is not required for a mechanical, plumbing or electrical permit, and should qualify for Over-the-Counter permitting.
If a building permit is required, then plan review is required. Plan review for a water heater replacement may qualify for Express Review.
Whether or not plan review is required, all work performed must comply with current codes and will need to be inspected - see Step 4.