Thank you all: Amarin, Kittysgreyvolvo, Spook, Will740turbo, Art Benstein for the advice and experiments regarding the expected operating temperature of a normally functioning alternator!!! That said however, here is the latest saga in this mystery:

(1) With the key in position 2 (ON), I disconnected the alternator excite wire at the alt and measured +12V when all of the dashboard lights were illuminated. This is what was expected, When the dashboard lights are all illuminated including the battery light, the car starts and the charging system is normal (except for what I thought was an overheated alt casing).

(2) With the key in position 2 (ON), I disconnected the alternator excite wire at the alt and measured 0V when only two dashboard lights were illuminated; the seat belt light and the SRS. The car easily starts and runs smoothly but it is not charging as the voltage between the battery terminals is ~12.3V instead of a normal 13.3-14.4V.

(3) I checked and cleaned all wiring connections, battery terminals, etc.

(3) I was advised that it could potentially be cold solder joints within the instrument cluster that is causing intermittent warning light illuminations. I have now removed the instrument cluster and reflowed some of the solder joints on the instrument cluster flex circuit however, I did not see any suspected cold solder joints. I am going to reinstall the instrument cluster hopefully tomorrow and retest the system. A visual inspection did not reveal any corrosion on the board or at any of the connections. Something is preventing the alt excite wire from getting +12V al the time. (I know from others that some people have run a wire from the +12V battery through a switch in series with a diode directly into the ALT excite terminal which bypasses the instrument cluster. Evidently, this may work but, if it is not switched off after driving, it will drain the battery. Further, it does not solve the root cause of the problem)

I am rapidly running out of ideas... Could it possibly be the ignition switch? I tried moving the key within the switch itself but saw no anomalies.

Any ideas would be greatly appreciated. I have another alt that has been tested and confirmed to be good so I am holding that in reserve. The alt that I installed was rebuilt one week ago and rigorously bench tested to be good.

Many thanks again!

OnlyVolvo