When the transformer's output power P2 is equal to the input power P1, efficiency η is 100%, the power transformer will not result in any loss. But in fact, this transformer do not exist. Power transformer will produce some loss when it transfers energy, such losses are mainly copper loss and iron loss.

Power transformer's copper loss concludes two types. One is magnetic hysteresis loss. When cross current go through the power transformer, the steel piece’s magnetic wire which enters the transformer, whose direction and size will alter with it. This change will lead to friction among the silicon steel inner body, so does the energy-releasing. Power loss is caused by this process. The other is the eddy current loss. When the power transformer works, there are magnet lines through the core. It will produce electric current on the vertical plane of the magnetic lines. For this current forms circulated loop on itself, so this called vortex. The existence of vortex makes the core of power transformer being in fever, so does the consumption of energy take place.

The efficiency of the power transformer is closely related to the transformer power rating. Usually the greater the power, the smaller loss and output power, the higher the efficiency. Conversely, the smaller the power, efficiency is lower.