FlasherZ can correct me, but I believe that's in the NEC. You want a larger ground wire so there is no possibility of it melting and disabling the ground, also it provides an easier path for the electrons to travel making for a better ground. My electrician explained a couple of days ago that the breaker panel ground wire size has been increased.
NEC section 250 - probably the largest in the book - deals with grounding. Table 250.122, "Minimum Size Equipment Grounding Conductors for Grounding Raceway and Equipment", calls for a minimum 8 AWG copper / 6 AWG aluminum ground for circuits and equipment attached to a 100A breaker. 250.4(A)(5) gives manufacturers the ability to call for a greater size if required to guarantee an effective ground-fault path. The NEC also requires you to follow manufacturers' instructions, so in this case you must install 4 AWG. In my opinion, it's probably overkill, but you have to follow their instructions.
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Thanks for the explanation. In this case (larger ground is better), is there any reason why I should not use 3awg for ground (rather than using 4awg)? The reason is that the 3 awg cost 0.75/ft but the 4 awg cost $1.25/ft. I have a really long run from the breaker box to where I want to put the HPWC.
The only reason you may not be able to use it is if the ground terminal is not rated for size #3 wire (if you have difficulty fitting a #3 into the terminal). It's marginally -- VERY marginally -- safer than using #4, but as mentioned above, #8 should work to create a proper ground fault path.