AF label on Service Disconnect and ATS in same Enclosure

With the awareness of arc flash, many giant manufacturers do not manufacture the Service Disconnect and the Automatic Transfer Switch located in the same section or enclosure. However, this practice can be seen in the field for switchboards rated as high as 600 Amps.
The dangerous part is the upstream of service disconnect is like a blind spot as the only protective device is the utility’s fuse on the primary side of the transformer and often result in high incident energy (greater than 40 Cal/cm2 in most of the cases) at the service disconnect. But because of service disconnect as protective device, in the downstream the incident energy on the ATS(normal-utility side) gets reduced to for instance less than 4 cal/cm2. The problem is although ATS has lower incident energy, it is located right below the Service Disconnect in the same section (enclosure). This is a arc flash hazard and I affix the conservative label (service disconnect) on the section that has service disconnect on the top and ATS at the bottom. So please share your thoughts on how you affix labels:
1. When the Service Disconnect & ATS is located in the same section (enclosure)
2. When there is a barrier between Service Disconnect and ATS located in the same section (enclosure).

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ATS Protection and UL

In looking at the latest edition [7th] of UL 1008 for transfer switches I came across the following:
“The circuit breaker must include an instantaneous trip response and shall not include a sort time trip response” as it relates to switches tested per 9.13.3.10 & 9.1.2.3.

It seems different manufactures have different interpretations. So does this disqualify any breaker with an adjustable STPU / STD setting from protecting a 3-cycle [0.05sec] any breaker rated switch, even if the breaker has an instantaneous override less than the interrupting kA of the switch? It seems counterproductive because if I have a LSI MCCB I can almost always provide better protection in the instantaneous and in the short time than with a standard thermal mag. C/B. For low level arcing / fault currents, that sometimes extend into the LTD portion of the T/M I can adjust the STD down to pick up these currents faster providing better equipment and personal protection? One manufacture I talked to indicated that if the breaker has an adjustable short time ahead of the switch the switch is misapplied, even though the TCC’s show different? Then what about the specific breaker ratings, many breakers on the “Specific Breaker” list can be provided with a myriad of trip units types and styles from your standard TM, to LI, LSI, LSIG. So does this restrict the specific breaker to the T/M? The literature does not differentiate. Just curious if anyone else has run into this and other thought and opinions… READ MORE.