Moisture contamination is the most common cause of deterioration in the insulating quality of oil. This contamination can be readily corrected by purification.

A slow but more serious deterioration, the formation of acids and sludge, is caused by oxidation. Thus, the exclusion of oxygen is of prime importance. In open-breather transformers, the oxygen supply is virtually unlimited and oxidative deterioration is faster than sealed transformers.

Atmospheric oxygen and oxygen contained in water are the sources available for the oxidation of insulating oils. When water is present in insulating oils, oxidation of the oil will take place. Therefore, leaking gaskets and seals constitute a very real hazard since a water leak is, in effect, an oxygen leak.

The rate of oxidation also depends on the temperature of the oil; the higher the temperature is, the faster the oxidative breakdown. An increase in temperature of 10°C (50°F) generally doubles the rate of oxidation.

The fact points to the importance of avoiding overloading of transformers, especially in the summertime. Oxidation results in the formation of acids in the insulating oil and the formation of sludge at a more advance state of oxidation.

Moisture in Oil
Water can be present in oil in a dissolved form, as tiny droplets mixed with the oil (emulsion), or in a free state at the bottom of the container holding the oil. Demulsification occurs when the tiny droplets unite to form larger drops, which sink to the bottom and form a pool of free water.

 Emulsified water typically requires vacuum dehydration, as the emulsification cannot typically be broken by filtration or by excellerated gravity (centrifuge). Water in the free state may be readily removed by filtering or centrifugal treatment.

However, dissolved water is not removed by centrifugal treatment; the filtration process can partially remove dissolved water if the filter papers are thoroughly dried before filtration, but the efficiency of the filtration process depends upon oil temperature and filtration media.

The effect of moisture on the insulating properties of oil depends upon the form in which the moisture exists. A very small amount of emulsified water has a marked influence in reducing dielectric strength of oil.

Free moisture in oil usually shows up above 50 to 60 ppm depending upon temperature. Accepted levels of water in oil. The amount of moisture that can be dissolved in oil increases rapidly as the oil temperature increases.

Therefore, insulating oil purified at too high a temperature may lose a large percentage of its dielectric strength on cooling, because the dissolved moisture is then changed to an emulsion, unless vacuum dehydration is used as the purification process.

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