When alternating current (AC) flows through a conductor, a pulsating or varying magnetic field is created around the conductor. This magnetic field is constantly expanding and contracting with the amplitude of the AC current. In the United States, the frequency is 60 cycles per second. Since AC reverses polarity 120 times per second, the magnetic field that surrounds the conductor also reverses its direction 120 times per second. This expanding and collapsing magnetic field induces eddy currents in the ferrous metal parts that surround the conductors, causing the metal parts to heat up from hysteresis.

Hysteresis heating affects only the ferrous metals with magnetic properties, such as steel and iron, but not aluminum. Simply put, the molecules of steel and iron align to the polarity of the magnetic field and when the magnetic field reverses, the molecules reverse their polarity as well. This back and forth alignment of the molecules heats up the metal -- the greater the current flow, the greater the heat rise in the ferrous metal parts.

When conductors of the same circuit are grouped together, the magnetic fields of the different conductors tend to cancel each other out, resulting in a reduced magnetic field around the conductors. The lower magnetic field reduces induced currents in the ferrous metal raceways or enclosures, which reduces hysteresis heating of the surrounding metal enclosure.

When single conductors are installed in nonmetallic raceways as permitted in 300.5(I) Ex. 2, the inductive heating of the metal enclosure can be minimized by the use of aluminum locknuts and by cutting a slot between the individual holes through which the conductors pass.

Aluminum conduit, locknuts, and enclosures carry eddy currents, but because aluminum is nonferrous, it doesn't heat up.