Dennis: Dedicated lines simply separate the power lines for your audio gear from all of the other wiring in the house. This in itself can reduce noise within the AC feeding your A/V system, but you are still susceptible to the noise that is coming in from the outside line feeding your AC mains. As such, an "optimum" installation would be one with dedicated lines and either a very high current power regenerator or extensive isolation via low impedance filtering / isolation. If you wanted to get "really crazy", especially if you had BIG high powered amps, would be to bypass all of the AC completely and feed your system off of a bank of batteries. If i had a simple, low powered system, that is probably what i would do. Since i am not in that boat though, i've had to go the first route.
An isolation transformer "uncouples" or "isolates" the A/V components from the outside lines. It is basically a 1 to 1 transformer. In other words, if you put 120 volts into it, you get 120 volts out of it. Due to the indirect coupling via the transformers windings though, you end up losing the mass majority of noise that may have been riding on the line. This is a good thing in every aspect. As stated above, "old school" iron core transformers are more efficient at "electrically isolating" the AC signal from the noise, but a toroidal design can also be quite effective. As Francisco stated, i would not pass up a good deal on a legit isolation transformer just because it was toroidal based. While it may not work quite as well as an equivalent E-I or C core "old school" transformer, it would none the less reduce the noise on the line very drastically. The drawbacks to the reduced efficiency ( in terms of reducing noise ) that the toriodals may suffer from can more than be made up for by compact size and measurably less weight than if one were to make comparisons with standard transformers.
The drawbacks to using isolation transformers is that they can introduce losses into the AC system and play games with the phase of the signal being fed to components. In both cases, this is typically a side effect of trying to use too small of a transformer for too big of a job. If the core of an isolation transformer is getting physically hot, you can bet that it is not big enough for what you are using it for and "bad" side effects will result. It is not abnormal for any device that is passing a reasonable to large quantity of power to undergo some type of temperature rise, but a transformer should NOT get physically hot to the touch. If it is, the transformer is simply not up to the task or being pushed too close to its' limits on a steady state basis.
As such, that is why i recommended using transformers that were rated for well above the amount of power that you intend to pull through them. This minimizes the potential for thermal losses / phase shifts while allowing the system to obtain all of the benefits of such a design. The use of higher current rated transformers also helps to keep the line impedance down, which is always a good thing. The "filters" used in many PLC's are of somewhat higher impedance and this can introduce problems of a different nature.
Hope this helps and explains a few things. There are variations to what i've mentioned, but this should cover the basics. Sean
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