4/0 Al SER to subpanel

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I don't understand how the 200A breaker would solve the problem of the 193.5A operational current being greater than the 180A ampacity of the 4/0 Al cable.

In real life there is no such operational current. (In fact 166A is not a number that goes into this.)

Simply put, 310.15(B)(7) allows you to protect 4/0 Al cable with a 200A OCPD for applicable dwellings. (We haven't gone into why it allows that in this thread. That's another topic.) Discussion of ampacities can end there. 4/0 AL SER, 200A breaker, it's okay. You can draw 200A on it until the breaker trips, NEC says it's okay.

The problem with your backup loads feeder is that the additional sources defeat the 200A OCPD that is upstream of the switch. Article 705 steps in and says you either upsize the feeder or protect it with an additional breaker at the switch. Now that you have a breaker there, that breaker can be 200A for the same reason that the one at the service can be. 310.15(B)(7) is back in force now that you've satisfied 705.
 
Thank you for bringing that up. I've been confused about when we can use the next higher OCPD. It seems like usually people size conductors connected to service panels for the breaker actually used, rather than next size up. I think it's because 240.4(B)(1) says the next size up cannot be used if the conductors being protected are part of a branch circuit supplying more than one receptacle for cord-and-plug-connected portable loads. So I thought I couldn't use it for conductors to a backed up loads panel. I do use it for the PV circuits up to the inverter though. Any clarification?
(B)(1) does not apply to a typical feeder circuit, it applies to branch circuits with more than one receptacle outlet.

Somewhat rare you would use this section. 50 amp and less receptacles next size up wouldn't really ever come up that often, at least when using 75C conductors. Not often would you have multiple receptacles on a circuit over 50 amps either, unless you have one equipment but multiple places to plug it in all on same circuit maybe.
 
I should have attached the SLD to eliminate confusion. For the MSP - smart switch circuit I think you have all confirmed we can use the 240.4(B) next size up rule or the 83% rule and the 180A 4/0 Al is fine.

However in the smart switch - backed up panel circuit, the max current could be 166A from MSP + 16.9A from solar + 10.6A from battery = 193.5A which is greater than the 180A ampacity of the 4/0 Al. We could solve this by limiting the current to the backed up loads panel with a 175A breaker.
How does this design comply with the 120% rule with a "lug kit" backfeed at the existing main service panel?
 
How does this design comply with the 120% rule with a "lug kit" backfeed at the existing main service panel?
I get that the sum of the inverter output currents, times 125%, is 27.8A. So no problem with the 120% rule on a 200A panel.

(290 VA * 14 (microinverters) + 1280 VA (storage)) * 125% / 240V = 27.8 A

Cheers, Wayne
 
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