The defect is that the Grounding Electrode Conductor is connected on the load side of the Service Equipment inside the cabinet of a feeder supplied panel. The US National Electric Code requires that the Grounding Electrode Conductor be connected on the supply side of the Service Equipment between the Point of Connection of the Service Conductors to the Service Drop or Service Lateral and the Grounded conductor in each service equipment disconnecting means enclosure.
Individual Grounding Electrode Conductors. A grounding electrode conductor shall be connected between the grounding electrode system and one or more of the following, as applicable:
(1) Grounded conductor in each service equipment disconnecting means enclosure
(2) Equipment grounding conductor installed with the feeder
(3) Supply-side bonding jumper
Service Equipment. The necessary equipment, usually consisting of a circuit breaker(s) or switch(es) and fuse(s) and their accessories, connected to the load end of service conductors to a building or other structure, or an otherwise designated area, and intended to constitute the main control and cutoff of the supply.
Grounding Electrode Conductor. A conductor used to connect the system grounded conductor or the equipment to a grounding electrode or to a point on the grounding electrode system.
Service Drop. The overhead conductors between the utility electric supply system and the service point.
Service Lateral. The underground conductors between the utility electric supply system and the service point.
Service Point. The point of connection between the facilities of the serving utility and the premises wiring.
Informational Note: The service point can be described as the point of demarcation between where the serving utility ends and the premises wiring begins. The serving utility generally specifies the location of the service point based on the conditions of service.