In rural areas here we have demand breakers on the customer side of the meter that are owned by the utility. They do not obviate the need for a service disconnect.
Example: A farm house may require by code a 100 Amp main service. This will require a 100 Amp main breaker. The utility owned demand breaker may be as little as 35 Amps.
Example: I helped a farmer do some upgrades.
An outdoor 100 Amp panel complete with a 100 Amp main breaker.
Some small local loads and a 100 Amp sub-feed to the home.
All fed from a 35 Amp demand breaker at the meter. (With a 100 Amp rated cable as per code.)
It depends.
The demand meter is behind the utility seal. That may make a difference.
Rural properties here are subject to a demand charge.
The utility does not meter the demand, rather they limit it with a demand breaker.
Smallest demand for a house is 5 KVA and they will generously give you a 35 Amp demand breaker.
If you have a shop they will want a 10 KVA demand.
I have a large shop but only a few led lights so I was allowed the minimum demand.
If I start welding and experience nuisance tripping I will either have to pay more for a 10 KVA demand breaker, every month.
Or, run the welder from my generator.
is the circuit breaker considered a disconnect per NEC?
It depends.
Bill
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"Why not the best?"
Jimmy Carter