Scottf and PRC,
Thank you for your replies. I have one more question, Why doesn't the potential transformer gets saturated during the peak voltage in every AC cycle. Say, If the PT is rated 10kV/0.11kV, during every ac cycle, the peak voltage reaches 10 x 1.414 which is 14.14kV. Normally the PT's have a continuous voltage rating of 1.2 times the nominal voltage, so here the continuous rating would be 12kV.