A common way that defects happen in homes is they simply get done wrong from the get-go. Improper installations that involve, inadequate earth-to-structure clearances, types of materials, missing flashings and code violations are all common.
Another way that defects happen is when repairs to existing, properly installed, components get done wrong–during the repairs. This is often the case in areas that involve multiple trades. For example Uncle Harry knows how to do plumbing–or at least good enough to make water run down hill and not leak–but does not fully understand the plumbing system as it relates to the electrical system.
Take for example, this outside faucet repair. One can see where the wall inside the garage has been opened up and new copper piping has been added, replacing the old galvanized pipe and non-frost free type faucet. While there are issues with attaching the copper to the galvanized pipe (electrolysis is possible due to the dissimilar metals), at least it was not leaking.
To make this repair or upgrade of the faucet however, the house grounding electrode was disconnected. One can see the disconnected wire at the left of the pipe. The electrical system was still grounded via the ground rods driven near the meter, but this defect results in the incoming water pipe no longer being used as part of the grounding electrode system and also results in all the metal piping in the home being un-bonded to the electrical system. This is how we can be grounded and not grounded all at the same time.
Without being overly technical, this condition creates a second pathway to ground (a person touching an energized conductor and the piping system at the same time). In the event of such a “ground fault,” a person might become part of the pathway, as the electricity flowed from the hot conductor, through the person, through the water pipe pathway to ground that was not connected to the electrical system ground.

Another issue with this installation is that any other metallic system that is using the metal water pipe for bonding purposes will also not be properly bonded. Systems like the phone, or cable, or gas piping, or metal drains, or hydronic heating system pipes might be affected.
Obviously the ground wire needs to be properly reconnected to the water pipe by a licensed electrical contractor. Not a difficult fix–but a potentially life saving one.
By Charles Buell, Real Estate Inspections in Seattle
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Good article, I run across this quite often in my inspections. Most of the time the “jumper” is missing or has been disconnected from the water meter all together. If I can’t find a solid plumbing ground it’s noted in the report as defective! It’s always nice to see it done right because you know that person cared and knew what they were doing, which is why i always recommend repairs by a licensed contractor and not “Uncle Harry”
Brandon, while water meters are very rare indoors here, the same sort of thing can happen with the installation of water filters, back-flow valves and water pressure regulators. Another compromise can occur when short pieces of metal water pipe are replaced with plastic. Continuity is king.
Is there a way to use electrical testing equipment to tell if there really is a separate equipment ground? Because, using a small receptacle tester will give a positive ground even if the neutral and ground wires are combined. I wonder this because quite often when renovations are made the electrical (unprofessional) installer can combine or reverse the two where it cannot be seen.
Jeff, yes there is–an electrical contractor can test them