A question is bouncing around the ECN group about this.
How can you have a downsized neutral in a feeder per 220.61 and not have it protected at it's ampacity per 240.4?
This is not one of the exceptions in table 240.4(G)
The handbook implies that as long as it is protected at the 250.122 level it is OK but 240.4 says 310.15

240.15 says 'ungrounded conductors'. The grounded conductor remains 'solid' in most applications thruout the system and is relied upon as a 'fault conductor' as well; unless switched with the ungrounded service conductors as permitted in 230.90(B). I personally consider the grounded conductor more important than the grounding electrodes as far as fault clearing.

There is no conflict. 240 will provide overcurrent protection for ungrounded conductors. 220 will provide information on the sizing requirements for neutral conductors based on a load calculation under different circumstances.

The grounded conductor (neutral) does not provide a path for (fault clearing)...except at the service. The equipment grounding conductor (EGC) provides the ground fault path. So a ground fault is a connection that takes place between a hot and the EGC or grounded part. A short circuit is a connection that takes place between conductors, neutral or hot, or hot and hot. So if you have a short circuit between a hot and neutral than the neutral will carry the short circuit current.
The grounding electrode systems is not used to clear short circuit current or ground fault current. 250.4(a)(1).

220.61 Is intended to allow you to use a grounded (neutral) conductor that is reduced when you have balanced loads such as ware heaters, furnaces, etc. 240v. single phase, as in a dwelling. The calculation has you account for any and all 120v. circuits AND the cooking and dryer loads. A neutral is only intended to carry the unbalanced load. The equipment ground carries the fault current from 240v. appliances.
240.4 is about the ungrounded conductors and their protection.
Grounded conductors cannot be smaller than the required equipment ground (T250.122).
I don't see how one is relevant to the other...

240.4 does not make that distinction. How is a downsized feeder neutral "protected against overcurrent in accordance with their ampacities specified in 310.15"?

I understand there is no real hazard, it just looks like a glitch in the code language. I was actually taking you guy's side on this but I was presented with the 240.4 language and it is not parsed to say it does not include grounded conductors.

Generally, the grounded conductor (neutral) NEVER has any over current protection. (sorry I cannot cite the reference for sure- Our office computers ban "SOCIAL NETWORK" sites and the code book is there) I believe it is 240.64 ? states that ONLY if the over current device in the neutral simultaneously opens all the ungrounded conductors can you have ANY over current in the grounded conductor. Think of the folly of putting a fuse in the green grounding bond wire: Since it only carries current from the grounded conductors when something goes wrong- you NEVER want it to open. The grounded conductor (neutral) is similar. The only current on it has already come through an over current device and is headed back to the source. You do not want to open that path; if something goes wrong and excessive current is flowing in the grounded conductors you hope that the over current will open before the device melts to the case and imposes that excess current on the bonding conductor in a complete failed and possibly dangerously explosive event.

If you really think about the calculations required in Article 220, there is a risk of possible overload. This is due to the allowance of demand factors and other permitted reductions. It wouldn't make sense to require a service and/or feeders to be sized for the actual connected full load of the premises wiring even though it is possible for that load to be present.

For example, A220 may indicate the need for a 100A service to a single family dwelling with a connected load well above 100A. But after all the demand and reductions permitted 100A is all that is required. This would naturally require #3 AWG copper service entrance conductors per T310.16. But, T310.15(B)(6) reduces the conductors even more to #4 AWG.

Consider section 240.4(B) that permits an overcurrent device above the ampacity of the conductors protected. Or section 230.90 - Exception 3 that allows the total rating of the service overcurrent protection to exceed the ampacity of the service conductors. In both cases, overload is potential.

Also consider that special rules apply to the grounded conductor that provides additional levels of protection. For example, 200.2(B), 300.13(B), 404.2(B), and 408.41. All these sections are intended to prevent the grounded conductor from being a source of a hazard.

One more comment. Probably 99% or more of the typcial installations today are with 90 degree insulated conductors. And since we never load our conductors to greater than 60 or 75 degrees, the problem of overload is really at the points of connection and not the conductor itself.

In many cases, the connections act as a heat sink and become the failure point in the system.

The unanswered issue is the language of 240.4
It does not differentiate between grounded and ungrounded conductors. It only says "Conductors, other than flexible cords, flexible cables, and fixture wires, shall be protected against overcurrent in accordance with their ampacities specified in 310.15, unless otherwise permitted or required in 240.4(A) through (G)."
There is nothing in (A) through (G) that exempts grounded conductors.

240.22

That is the location of the overcurrent device. Grounded conductors are protected by the O/C device in the ungrounded conductors. (hence 250.122 and the grounding conductor) but that is still in conflict with 240.4

Never looked for this before because I always knew you didn't want to fuse a neutral because of the danger of single circuits not having a ground path but here are the code sections prohibiting overcurrrent protection of a grounded conductor:
230.90(B) and 240.22 and exceptions when the overcurrent device opens all the ungrounded conductors simultaneously with the grounded one and for certain motor overload protection installations.

Thanks for the info....