Okay, this is a common but often misunderstood situation. Let's break it down

The Core Problem: Service Conductor Overcurrent Protection

Yes, service conductors are supposed to be protected from overcurrent. However, the rules are different and more nuanced than branch circuit or feeder overcurrent protection. The key is understanding where that overcurrent protection is required and how the code allows for diversity and load calculation.

Analysis of Your Situation1. Your Service Entrance Conductors

You have 1/0 tinned copper RHH/RHW. Depending on the temperature rating (likely 75°C) and the specific code cycle in effect when it was installed, 1/0 copper RHH/RHW is likely good for about 150 amps at 75°C. (Table 310.16 in the NEC, though ampacities can vary in older editions.)2.

The 200A Main Breaker + 60A Fused Disconnect

This is where the problem arises. You have a potential total overcurrent protection of 260 amps feeding from a conductor rated for only 150 amps.3.

The Issue: Tapping off the service entrance conductors for the 60A fused disconnect before the main overcurrent protection in the 200A panel creates a code violation. The 1/0 conductors between the service drop/lateral and that 60A tap are unprotected against overcurrent up to 260A. That's not compliant with modern codes, or even most older ones.4. Diversity & Load Calculation (The Nuances)

The reason this sometimes appears to work, and the reason older installations get away with it, is due to

load diversity. The code allows for calculating the actual load on the service, rather than simply adding up the nameplate ratings of all the overcurrent devices. If the calculated load on the service is significantly less than the sum of the overcurrent devices, the service conductors might be adequately sized in practice.5. MLO Panel as Service You mentioned a MLO (Main Lug Only) Panel with multiple breakers as a service, with the sum of the breakers exceeding the conductor ampacity, the same issues applies. There is no main overcurrent protective device protecting the service entrance conductors. Older code did not allow MLO panels as service equipment. (See 230.71(B) and 230.90 Exception 3 in the 2020 NEC).

Why This Was (Possibly) Allowed Before (and Why It's Still Problematic) Older Code Interpretations

In the past, some inspectors were more lenient about applying load calculations and diversity. They might have allowed this if the perceived load was far less than the overcurrent protection.

Practicality vs. Code

Sometimes, older installations were grandfathered in, even if they didn't perfectly meet current code.

Ignoring the Risks

Simply because it hasn't caused a fire doesn't mean it's safe. An unforeseen increase in load could lead to overheating and failure of the service conductors.

Code Sections to Consider (Based on Modern NEC) 230.90(A)

Overcurrent Protection. This is the primary section that mandates overcurrent protection for service conductors. The key part is "not higher than the ampacity of the service-entrance conductors."

230.90 Exception 3

This exception (in some code cycles) allowed for up to six disconnecting means to serve as the overcurrent protection if the calculated load didn't exceed the conductor ampacity. This exception is very limited and doesn't apply to your situation with a 200A main and a separate fused disconnect.

220

Load Calculations. This entire article deals with how to calculate the service load. This is the key to justifying smaller service conductors.

310

Conductors for general wiring. Includes ampacity tables.

110.3(B)

Listed and Labeled Equipment. If the equipment (especially the split bolts) weren't listed for aluminum-to-copper connections, that's also a violation.

110.14

Electrical Connections - addresses the use of proper connectors

What You Should Do (Recommendations)

Calculate the Actual Load

Before doing anything, perform a thorough load calculation according to Article 220 of the NEC. This is the most critical step. Determine the existing loads of all tenants in the building. This might require some investigation.

Options Based on Load Calculation



If the Calculated Load is 150A or Less

This is unlikely, but if the load calculation shows the service is truly lightly loaded, you might be able to argue that the existing 1/0 conductors are adequate. However, this requires documentation and acceptance by the local inspector. Even then, the setup with the 60A fused disconnect tapped off before the 200A main is still a problem. You'd need to eliminate the 60A tap.

If the Calculated Load is Between 151A and 200A

You'll need to upgrade the service entrance conductors to at least 2/0 copper (for 200A at 75°C). You could keep the 200A panel. You'll also need to fix the 60A disconnect issue.

If the Calculated Load Exceeds 200A

You absolutely need to upgrade the service entrance conductors and possibly the panel. This might require a new service entirely.

Correct the Taps

Regardless of the load calculation, you must replace the split bolt connections with Polaris-style connectors listed for copper-to-aluminum connections.

Eliminate the 60A Tap

The best solution is to eliminate the tap and feed that load from a breaker inside the 200A panel. If this isn't possible, you'll need to run appropriately sized conductors from the 200A panel to a new fused disconnect, protecting those conductors with a breaker in the 200A panel.

Inform the Customer

Explain the code violations and the potential risks. Provide options with cost estimates. Let them make an informed decision. Document everything.

Why Your Customer's "Repair Only" Request is ProblematicThe customer's desire for a simple repair is understandable, but you, as a licensed electrician, have a responsibility to address code violations and safety concerns. Patching up a dangerous situation could expose you to liability.

In ConclusionYou are correct to be concerned. The existing installation is likely a code violation and a potential safety hazard. Performing a load calculation is the crucial first step. You then need to present the customer with options to bring the service into compliance with current codes. It might be a costly repair, but it's necessary for safety and to avoid future problems. Document everything, and get the customer's informed consent in writing.

Disclaimer:* This information is for general guidance only. Always consult the applicable codes and regulations in your jurisdiction and consult with a qualified electrical engineer or inspector for specific advice. Also, always defer to the Authority Having Jurisdiction (AHJ) for final determination. Flag for review