You're on the right track, but let's break this down to ensure accuracy

Understanding the Code:
310.16

This table provides the allowable ampacities of conductors based on insulation type and temperature rating before any derating adjustments.

310.15(C)(1)

This section covers adjustment factors for more than three current-carrying conductors in a raceway or cable. This is where your 50% derating comes from.

240.4(D)

This section deals with overcurrent protection for conductors, including small conductors like #12.

Your Scenario Analysis


Starting Point

You have #12 THHN conductors. According to Table 310.16 (90°C column), they are initially rated for 30 amps.
2.

Derating

With 10 current-carrying conductors in the conduit, you must apply a 50% derating factor (from Table 310.15(C)(1)). 30 amps 0.50 = 15 amps.
3.

Overcurrent Protection

This is where 240.4(D) comes into play.

240.4(D)(3)

Generally, a #12 copper conductor is protected at 20 amps unless other specific conditions apply (like motor-starting applications).

The exception in 240.4(D)(3) does NOT override the derating requirements of 310.15(C)(1). The conductor must be protected at its adjusted ampacity.

Answer



You cannot put these conductors on a 20-amp breaker. NEC 240.4(B) allowing you to use the next size up of an overcurrent protective device does not apply here.You have a few options


Reduce the Number of Conductors

Remove conductors to reduce the derating requirement. With 9 CCC conductors, your ampacity adjustment would be 70%. Your #12 would be rated for 21 amps. You could put it on a 20 amp breaker.2.

Use a Larger Conductor

Use #10 THHN. #10 THHN is initially rated for 40 amps. With a 50% derating, it becomes 20 amps. Now you can use a 20-amp breaker.3.

Use Multiple Conduits

Split the conductors into multiple conduits to reduce the number of current-carrying conductors in each.

Important Considerations



Current-Carrying Conductors (CCC)

Remember that only current-carrying conductors count toward the adjustment factor. Grounding conductors and, in some cases, neutral conductors do not count.*

Continuous Loads

If the load is considered "continuous" (operates for 3 hours or more at a time), the overcurrent device must be rated for at least 125% of the continuous load. This might further limit your breaker size.

In summary, always prioritize conductor ampacity. Derating factors significantly impact the allowable ampacity and, therefore, the appropriate overcurrent protection. Consulting a qualified electrician is always recommended for complex electrical installations. Flag for review