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Can any one explain me in detail the magnetizing current and working currents that occur in no load conditions? I know that they are the vertical and horizontal components of no load current.. But how? Explain practically?

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For a transformer, in no-load conditions you might as well forget about the secondary winding and regard the transformer primary as an inductor. I'm presuming here that you are talking about power transformers.

Magentizing current is due to the inductance of the primary winding. This is the dominant current and for a typical medium power transformer such as used in home appliances (before the introduction of switch-mode supplies) 10 henries might be a good value.

At 50Hz the inductive reactance is \$2\pi F L = 3142\Omega\$. This causes a current to flow (from a 220Vac supply) of 70\$mA_{RMS}\$. This is nearly a purely reactive current lagging the voltage supply by nearly 90º.

Losses - there are two main losses - eddy current losses and hysteresis losses. Eddy current losses are due to eddy currents being induced in the silicon-steel laminates: -

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If the laminates were a perfect conductor the induced currents would serve only to reduce the inductance of the primary winding i.e. there would be no losses. However, the relatively poor conductivity of the laminate and it's thin width restrict eddy currents and, in effect put a resistor in parallel with the primary inductance.

Aside - Ferrites (at low-medium frequencies) have much higher resistance and have much lower eddy current losses - this is also why they are used at high frequencies.

Hysteresis losses come about because of the shape of the BH curve. As you magnetize the core then demagnetize the core you find that there is wasted energy in reversing the magnetic domains in the laminates. This forms another resistor in parallel with the primary inductance.

Both losses can be lumped together to form one value of resistance representing loss of the unloaded transformer.

Does this help? There's more about transformer losses here

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