Maybe I breezed over this but it is common for the POCO to pull the service conductors to the main panel if it is underground fed. If you were using a 400 amp residential panel (320amp continuous) with 2 200amp breakers in it, would you base your water main ground conductor on there wire size? or the combined size of your conductors from the meter ( package unit ) to the pair of 200amp breakers. It is common for the POCO to pull in much smaller conductors then you would expect, and basing the ground conductor to the water main on this fact would directly affect the size of the wire. #4 cu may be just fine based on this as long as POCO is 250kcm AL or smaller.