Okay, let's break down the situation and clarify the proper connections for a separately derived system (SDS), like a generator or transformer, with the goal of electrical safety and code compliance.

Understanding Separately Derived Systems (SDS)

A separately derived system is an electrical source that is not directly connected to the utility power grid. Common examples include: Generators Transformers (step-up or step-down) Solar inverters (in certain configurations) UPS (Uninterruptible Power Supply)The critical thing about an SDS is that it creates its own neutral and ground reference. Therefore, it needs its own grounding system.

The Neutral-to-Ground Bond: The Key Point Yes, the neutral conductor of a separately derived system must be bonded to the grounding electrode conductor (GEC) at one point – and that point is typically at the source of the SDS or at the first disconnecting means. This is absolutely essential for proper operation of overcurrent protection devices (circuit breakers, fuses) under fault conditions. This bond creates a low-impedance path for fault current to flow back to the source, causing the breaker to trip and clear the fault quickly. Without this bond, a ground fault could energize metal enclosures, creating a shock hazard, and the overcurrent protection might not operate.

Why at the Source (or First Disconnect)? Origin of the SDS

The neutral is created at the source of the separately derived system (the generator windings, the transformer secondary). The neutral bar in a panel fed by this SDS doesn't create the neutral; it's just a distribution point.

Fault Current Path

The purpose of the neutral-to-ground bond is to provide a defined, low-impedance path for fault current back to the source. If you bond the neutral and ground at a downstream panel, fault current might take unpredictable paths, potentially through building steel, conduit, or other equipment, which is dangerous.

Your Specific Situation (Blue Arrow)

The "Blue Arrow" connection you describe is likely where the neutral conductor from the SDS (e.g., your generator) is connected to the neutral busbar in the panel. If the Ground Bus Bar is where the Grounding Electrode Conductor connects to, then, that should also be connected (bonded) to the Neutral Bus Bar at the First Disconnect.Is Your Wiring a Mistake?

Based on what you've said, it sounds like you might have made a mistake if you haven't bonded the neutral to the ground at the source of the SDS or at the first disconnecting means of the system. Here's what you need to verify:1. Locate the Source (Generator, Transformer, etc.)

Find the generator, transformer, or other SDS that is supplying power to the panel in question.2.

Identify the First Disconnecting Means

This is the first breaker or disconnect switch after the source.3.

Check for a Neutral-to-Ground Bond



At the source (generator, transformer) OR the First Disconnecting Means

Is there a solid, properly sized conductor connecting the neutral conductor (or neutral bus) to the grounding electrode conductor (GEC) and the equipment grounding conductors (EGCs) at either the source of the SDS or at the first disconnect?

What to Do Now


STOP! Do not continue using the system until you are certain that it is wired correctly and safely. Incorrect grounding can be extremely dangerous.2. VISUAL INSPECTION

Carefully trace the wiring from the SDS (generator, transformer) to the panel. Look for the neutral-to-ground bond at the source or the first disconnecting means. Take pictures.3.

Consult the NEC

The National Electrical Code (NEC) Article 250 covers grounding and bonding. Specifically, look at sections regarding separately derived systems. (NEC 250.30 and 250.32 are highly relevant.)4.

Call a Qualified Electrician

This is the best and safest course of action. A licensed electrician can inspect your wiring, verify compliance with the NEC, and make any necessary corrections. They have the knowledge, experience, and tools to ensure your system is safe and code-compliant.5.

Provide the Electrician with Detailed Information

Explain the situation, show them the wiring, and tell them that it is a separately derived system. Also, inform them that you need to have the first disconnect bonding reviewed.

Important Considerations



Size of Conductors

The size of the grounding electrode conductor (GEC) and bonding jumpers is critical and depends on the size of the SDS's conductors. The NEC provides tables for determining the correct size.

Grounding Electrode System

You may need a grounding electrode system (ground rod, ground plate, etc.) at the source of the SDS, depending on the installation and the requirements of the NEC.

Multiple SDSs

If you have multiple separately derived systems, each must have its own neutral-to-ground bond at its source*. You cannot have multiple bonds in different locations.

In summary: A neutral-to-ground bond is REQUIRED at the source of the SDS or First Disconnecting Means of the SDS. Review your wiring. If there is no bond or you are uncertain, immediately contact a licensed electrician for help. This is very important. Flag for review