I haven't heard of this. It is in their green book.
I can see understand new construction, but on remodel such as a ranch where ALL of the bedrooms are on one end of the house and the original panel is on that end?! Are there any exceptions to this that you are aware of?
I believe if it is "like for like" (rating wise) replacement.
This rule has been in their book for a very long time and because of the older mechanical meters that would turn and the vibration may make noise on the bedroom walls and people could not sleep. They were not really enforcing this rule. Interestingly, they started enforcing it ever since they started installing electronic meters that do not make any noise.
GO FIGURE:huh::huh::huh: