You can see thermal expansion on a system gauge if the water heater is recovering with no system flow. The gauge will continue to increase above the PRV setpoint until the relief valve pops off or the PRV bypass operates or some other system flow occurs. As soon as flow occurs the PRV will restore the correct pressure. It happens with all systems and PRVs. Relief occurs immediately when system water is used.
Thermal expansion is a nuisance and can be messy.
If you install an approved expansion tank or expansion relief valve in the system, then the adverse effects of thermal expansion can be controlled. As much as we and our competitors like to sell PRVs, we can't recommend that you waste your time fixing something that isn't broken. If you know that the street pressure exceeds 150 psi, recommend an expansion tank at the outset. If this happens too often or is too much of a nuisance, an approved expansion tank or device can be installed to control the problem.