flue pipe size for venting water heater

On common natural draft NG water heaters, I usually see 4" vent pipe, but I was looking at specs on a 40gal unit on the Ruun web site, and the chart shows 3" for residential sizes up to 60 gallons. Somewhere else I was reading that it is not a good idea to have oversize flue vents on gas appliances. I can see where oversize vents would also be an energy waster. Are a lot of people installing vents that are too large? Anyone know of a good reference for sizing vents.
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bill allemann wrote:

Often, it comes down to what the local inspection requirements are. Some cities won't permit 3" vent.
The draft hood bypasses most of the air around the heater in standby mode so I doubt that losses are significantly different for 3" or 4".
Jim
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Locally, we can't use a 3" vent if the water heater is the only appliance on the chimney.
JK
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