The answer to 'why is my water heater not cooling' is that the water heater may have a malfunctioning thermostat or temperature control. This can prevent the water from cooling down properly, leading to scalding hot water coming from your taps.
Some other common causes include a broken dip tube, sediment buildup in the tank, or a problem with the heating element. These issues can all prevent the water heater from cooling the water to the desired temperature.