For now: put the transfer switch and both subpanels on the same breaker
For the time being, I would re-route the feeder to the new subpanel into the transfer switch, so that both subpanels run off the same 100A feeder breaker in the meter-main. Considering that your current meter-main cannot provide a 200A feeder to the transfer switch due to wire-bending issues, and that your house is lightly loaded (with merely a booster pump for large appliances, as all the major heating appliances run on propane and there's no air conditioner to worry about either), this provides the simplest solution for getting both panels on the transfer switch at this point in time.
I would run some 1AWG aluminum (2 hots and a neutral) through the existing nipple to jumper between the existing SER to the new addition and the transfer switch load connections. However, since there aren't any alternative lug kits available for your switch, and using lugs that aren't part of the switch's listing voids that listing, you'll have to use pigtails of 250kcmil aluminum wire from the existing lugs to some sort of splice that branches off to the two sets of load wires. I would use a UL listed (to UL 1953, category code QPQS) 3-pole power distribution block rated for 250kcmil line wires and 1AWG load wires for making this splice inside the switch enclosure; this block gets screwed to the back of the switch cabinet with ordinary sheet-metal screws, and provides a neat, stable point for making this connection at. (You should be able to find a suitable block at a local electrical supply house; if they ask for a part number, or you need to search online, the Mersen MPDB67013 works for this application and is relatively inexpensive/available.) Likewise, the cheapest/simplest way to make the splices between the jumpers and the SER in the breaker enclosure would be to use a similar splice block rated for 1AWG line and load wires (such as a Mersen MPDB63153); NEC 312.8(A) permits mounting power distribution blocks in switch and loadcenter cabinets, and the alternative (insulated mechanical splicing connectors) is both messier and more expensive.
For later: switch the service equipment out for something you can get 200A out of
The main downside to the former solution is that you're constrained to 100A to both panels; fixing this will require replacing the service equipment, due to the fact your existing equipment cannot supply any more than a 100A feeder to any one location, no matter how you try to slice or dice it. This is aggravated by the constraints your existing installation puts on the new service equipment:
- It needs to have a ring style meter socket...
- and otherwise comply with EUSERC specifications, so that PG&E will accept its use
- In order to fit in the existing space, it needs to be a single column meter-main or meter-loadcenter (vs. a two-column design, either side-by-side or over/under), and
- Preferably, it has the same knockout pattern as the existing service panel, and accepts the same type of breakers (Square-D Homeline) in order to minimize rework
This leads us to the Square-D SU816D200C; this meter-main complies with EUSERC specifications, with a single 200A main breaker feeding an 8-space, single-column loadcenter with feed-through lugs that allow the full 200A capacity of the service to be brought out to the transfer switch. However, it also provides a space for a 50A secondary disconnect tapped from the line-side of the 200A main breaker; this is fine for now, but can be problematic in the future due to a change in the upcoming 2020 NEC where the "rule of six" that permits such multiple-disconnect configurations is slated for removal, requiring all new service equipment to have a single main disconnect.
From there, we run 250kcmil aluminum from the subfeed lugs on the new meter-main to the transfer switch. If you wish to upgrade to a hardwired generator set (presumably propane powered) with an automatic transfer switch at this point, it would be an opportune time for such, or you could simply keep the existing setup and upgrade the generator later. From the load lugs on the transfer switch, we then run more 250kcmil aluminum in a 2" RMC nipple to the lugs on a HOM12L225PRB; the existing 1AWG feeders get connected via 1AWG jumpers run in the aforementioned nipple to HOM2100 breakers in this panel, along with matching LK100AN or LK125AN neutral lugs for the neutral bars in the new subpanel.
