The mission of the Advantage LTC is to measure the true temperature differential between the main and LTC tank fluids, reject transient temperature differences and alarm when the true temperature differential exceeds a pre-set magnitude.
The main tank contains the working windings of the transformer, which produce large I2R and eddy current heating when the transformer is energized. Because a "healthy" LTC switch generates essentially no heat when it is not switching, the temperature of the LTC tank is typically lower than the main tank. There is some effect due to transformer cooling, but the Advantage recognizes this condition. When the main windings and LTC are operating normally, the long term temperature differential between the two tanks is roughly constant.
As the LTC switch contacts age or wear, their resistance increases. Heat generated from this increased resistance raises the LTC fluid temperature. At some point the heat becomes too great for the surrounding fluid to dissipate. Rapid contact degradation and LTC failure eventually occur. Before this point, the Advantage LTC can provide warning of the increase in LTC temperature, allowing preventative measures to be taken.
LTC Monitoring Application Note (pdf) with information on probe selection, filtering, thresholds and alarm setpoints.