The other day we had our water heater go out and the issue was diagnosed to a faulty thermocouple. When the repair man removed the faulty thermocouple he noticed the following disk-like component in series about mid-way down the copper tubing.
This device had one of its two terminals broken off of the bottom (not shown) and was most certainly the cause for the failure. The repair man's replacement thermocouple had no such device inline and when asked what this was he replied it was a transistor. I very much doubt this device is a transistor as there are only two, not three, terminals but I didn't want to argue.
So, what exactly is this component and what is it's function? As stated, the replacement thermocouple does not have this but it appears to be functioning correctly.