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The Current meter seems to be bouncing off its zero stop from vibration. If your hand held meter says the voltage is steady at 120/240, then Richard's theory is looking good. See if the current meter starts behaving when you put a load on the generator and the needle comes off the stop.

I'd want to find the cause of and cure the fluctuating gauges. I can envision something like an intermittent partial short in the wiring that's really drawing current intermittently, for example. But since you're getting steady voltage, it looks like your generator is working fine.

If the generator isn't loaded and it's 40F out, the shutters, which are actually the air outlet, won't open much, if any. At least that's the way my 003A is. Keep an eye on them though, because on a warm day and under load, they should open quite a bit. Last summer, while powering my house...