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Discussion Starter #1
I’ve got a two part question:
1) I’m replacing outlets in a room and noticed all the wires are stripped in the middle. There are not any pigtails or caps in the boxes. Is this acceptable per code?

2) I’m also replacing the light switch with a dimmer (Lutron) wired as single pole. My circuits use blue, yellow, and white for the wires in the room. As shown in the pics, yellow and blue are connected to old switch. For the new switch I was going to connect yellow to black, and blue to red. Cap the red/white. Does that sound correct? The current switch is not grounded to the box. Is it ok to leave the new switch the same?

For more reference on my color setup, one outlet has a single yellow wire to a hot connector, a middle spliced blue to the other hot and a middle spliced white to the neutral. The rest of the outlets around the room only have middle spliced blue to hot and middle spliced white to neutral.
 

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Guapo
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I never saw blue & yellow nor have I seen wires stripped in the middle. What's hot & what's not? What kind of fixture does the dimmer control?
 

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Master Electrician
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You have a conduit wiring system. As you note, the hot conductors will not always be black or red. The first photo is perfectly acceptable. The second receptacle with blue and yellow is probably a half-switched receptacle.
On the switch the blue is probably the constant hot and the yellow is probably the switched conductor, likely switching the receptacle half with the yellow conductor.
FWI, installing dimmers on receptacle is not recommended as an inappropriate (high ampacity) load could be connected to the recepatacle which could destroy the dimmer.
 

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Discussion Starter #4
Ah, that makes sense. That switch also controls the lights on the ceiling fan in the room but the fan itself operated independently of the switch. Would installing a dimmer switch to dim the ceiling fan lights cause problems for the half switched receptacle?
 

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A "Handy Husband"
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Stripping a conductor in the middle and looping around a screw is called "rabbit earring" and is compliant
 
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Licensed electrician
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You cannot install a dimmer on a regular receptacle per code.
 
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Hera still sells UL-listed halogen lighting transformers that have a standard 110 cap and are dimmable on the primary (they point out that feature in the literature). I used them in a former house of mine. Transformer above the cabinet plugged into a single receptacle connected to a standard dimmer. Somebody should tell them they are selling a product that has the wrong end cap.

http://www.heralighting.com/top/products/halogen/premium-line/arf20arfs20/

http://www.heralighting.com/top/products/halogen/halogen-accessories/transformers/uk-120-tw/
 

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Lutron makes a dimmable receptacle and Special plug to go with it.
https://www.amazon.com/Lutron-SCR-15-HDTR-SW-Dimmable-Resistant-Receptacle/dp/B006XY2LUO
It is pricey though. You will pay anywhere in the $45-70 range to get the pair.
(I linked to the half switched version, there is another version the both halves switched application)

And no, you won’t find them at a big box, although they might special order them for you.
I have certainly never seen a fixture or plug like that. It seems like it could be very confusing to most people because it looks so close to being a normal outlet.
 
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