Electrical question on floating neutral generator for emergency use

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There is tons of information on "bonded neutral" and "floating neutral" generator wiring to transfer switch. However, I have one question I cannot find the answer.

I recently bought a Reliance Control Transfer Switch TF151W (2-pole transfer switch) for the furnace, because I cannot use an extension cord for furnace. In North American, all service panel in our houses have Neutral (white) and Ground (Green/bare copper) connected/bonded by code. In this case, the ONLY option for me is to buy a "floating neutral" generator in order to avoid the dangerous "double bonded" scenario.

Say I want the generator to power my (1) furnace via transfer switch and I want to power my (2) gas water heater using extension cord plugging it into the outlet of the generator. Will there be a problem?

Say, the Generator is "Floating Neutral", I have:

Generator Outlet #1 -> Transfer Switch AC Panel (bonded) -> Furnace

Generator Outlet #2 -> Extension cord -> Gas water heater (not bonded)

My question is: If I unplugged #1 and only run #2, the gas water heater is running on floating neutral. But what if I run #1 and #2 at the same time, will all the outlets on the generator automatically turn into bonded neutral?

Reason I ask is that some gas water heater is very sensitive, they won't start if they detect it is not grounded.

Best Answer

Lets start with your premise that you must buy a 'floating neutral generator'. That is simply not true, you can buy code compliant transfer switches with neutral-grounding disconnects built in as described in this video.

Next, you seem to be worried about a possible 'transient voltage;' created by double bonding your generator. This will only occur if the generator is already self-bonded (bonded-neutral), and wouldn't be a concern in the scenario you described.

However, your concern about trying to power a water heater with a floating generator via extension cord isn't misplaced as water heaters often will not run if they detect a lack and unbounded neutral. Thus if you were to ever try to run the generator to power your water heater without it also being connected to the electrical panel for your furnace (such as having having your your transfer switch turned off), you may experience an error.

To fully wrap you head around this, I found this video explained exactly what bonded-nutural is and the type of power a floating-neutral generator produces