Why neutrals and grounds must be separated in a subpanel, and what happens when they aren't

The neutral is bonded to ground by the main bonding jumper inside the service disconnect enclosure, and only there. Writing in EC&M, code trainer Mike Holt cites NEC 250.24(B): downstream of the service disconnect, the neutral may not touch equipment metal or equipment grounding conductors. Section 250.142(B) applies the same idea to feeders, so the neutral feeding a separate building cannot be landed on that building's disconnect enclosure.

In a correctly wired subpanel the neutral bar is isolated from the can. If the bonding screw or strap stays in, the neutral and the ground wire both tie the subpanel back to the service, and part of the normal load current takes the grounding route: the bare or green conductor, metal raceway and panel enclosures. Holt calls this objectionable neutral current, which 250.6(A) prohibits. It takes little of it, he writes, to cause a shock, electrocution through ventricular fibrillation, or a fire.

The rule now reaches panels that used to be the main. Section 230.85 of the 2023 NEC requires an outdoor emergency disconnect at one- and two-family homes. The New York Electrical Inspection Agency found that most outdoor whole-house transfer switches carry a service equipment label. When one of them is used as the emergency disconnect, the agency wrote, the grounding electrode conductors terminate in the switch, a four-wire feeder (two hots, neutral, ground) runs to the house panel, and that panel must keep neutrals and equipment grounds apart. A three-wire cable left from the old service has no conductor for that ground, so a new one has to be pulled.

Older work has one carve-out. Holt notes that an existing feeder to a separate building may keep using the neutral as the fault return path if no continuous metal paths run between the buildings, no equipment ground-fault protection sits upstream, and the neutral is at least the larger of the 220.61 unbalanced load and the 250.122 grounding conductor size. New feeders to a separate building need an equipment grounding conductor under 250.32(B)(1).