Does anyone know what this object is that is tapped into the service conductor lugs in the main service panel?
I do not know what it is, but I do know that taping into the main lugs is wrong.
Looks like a lightning arrestor or a surge suppressor.
IIRC the instructions may have called for them to be installed in the incoming lugs. I know that the lug only is for one conductor, however the lead will fit between the strands of the main conductor and still be secure. I do not know how a AHJ inspector would see this.
It a line filter.
But not installed as the mfg. intended.
It is likely a lightning arrestor. The capacitor is often placed outside the panel box so that it is visible (in case it fries from a strike). Installed properly IMHO. Although in this case it appears that it is covered by drywall.
Thanks