A basic circuit consist essentially of Two parts:
1. The Conductor--which carried the current around the circuit.
2. The Insulation---which keeps the current inside the conductor.
Only 2 types of circuit faults can occur. Either break in the insulation or break in the conductor.
The break in the conductor leads to non-flow of current in the circuit. A break in the insulation leads to an earth fault, allowing the conductor to touch the hull or earthed metal enclosure.
A short-circuit fault is due to the double break in the insulation, allowing both conductors to get connected, thus a very high current passes through, by-passing the load.
A majority of earth faults occurs within the equipment. Generally insulation failure occurs which leads to the conductor getting in contact with the body of the metal enclosure. When such earth faults happen, the metal enclosure of the equipment if not earthed, it would cause a heavy shock, and may result in fire accidents too..
SIGNIFICANCE OF EARTH FAULTS:
If an earth fault occurs in an "earthed distribution system", it would be equivalent to a "short-circuit" fault across the load via ship's hull. The resulting large earth fault current will immediately "blow-up" the fuses in the line. Thus the equipment is isolated from the supply and thus rendered safe. This may result in hazardous situation, if the equipment is classed as "essential" for eg: steering gear. Thus the "earthed distribution system" requires only one earth fault on the line conductor to cause an earth fault current to flow.
If the earth fault occurs in "insulated neutral distribution system", will not cause any equipment to go out of operation and thus maintains the continuity of operation of the equipment. This point is to be noted," the machinery still continues to operate". Thus a single earth fault will not provide a complete circuit for the fault current to flow. If a second earth fault occurs, then the two earth faults together would be equivalent to a short circuit fault ( via ships hull) thus resulting large current would operate the protection devices, cause disconnection of, perhaps, essential services creating a risk to the safety of the ship.
An insulated neutral distribution system requires two earth faults on two different lines to cause an earth fault current to flow. Thus an insulated neutral system, is ,therefore, more effective than an earthed system in maintaining continuity of supply to equipments. Hence it is adopted for most marine electrical systems.