I was recently hired to make corrections to a job originally done by the home owner. The home owner has moved away and is trying to get a final inspection so that he can sell the house. I called the inspector and asked him what violations needed to be corrected. His reply blew me away because I have never herd an interpretation of the code like this one.

Here's the layout, picture this:
400 Amp, underground service, to a 320 Amp, outdoor meter pan, the meter pan has no main breakers, it's lugs out only. There are two distributions panels each one having it's own 200 Amp main circuit breaker. The wiring method between the meter pan and the two main-distribution panels is #4/0Alu SEU cable. Each SEU cable is no more then 4 feet. Everything in the panels looks code compliant, including all grounding & bonding.

Now there's the problem, the inspector is stating that because there is a swimming pool on the premises the SEU cable between the meter pan and the main-distribution panel which serves the pool must be replaced with a wiring method specified in 680.25 (A) (we are still on the 2005).
He sites 680.25 as his reason.

I fully understand the restrictions and mandatory wiring methods to be used from a main panel to a sub-panel serving pool loads (feeders & branch circuits). But I do not be-leave it is the intention of 680.25 to apply these restrictions to the wiring methods prior to the main switch. It basically boils down to, do we need to have an insulated equipment grounding conductor starting at the meter or service head.

For clarification I asked the inspector the following question: so if I had a single family house with a 200 Amp overhead service wired with Aluminum SEU cable as the wiring method between the point of attachment and the meter pan, that house could not have a swimming pool, given everything is new and we are not applying any of the exceptions. His reply was "correct".

Since he's citing 680.25:
680.25 Feeders. These provisions shall apply to any feeder on the supply side of the panel-boards supplying branch circuits for pool equipment covered in Part II of this article and on the load side of the service equipment of source of a separately derived system.

He's using the part stating "AND ON THE LOAD SIDE OF THE SERVICE EQUIPMENT". Well I have to admit, it does seem like he might be on to something because the SEU is on the load side of the meter pan, but is the meter pan considered "service equipment". I can't be-leave that this was the intent of 680.25
I would appreciate any comments on this subject.