A protective system far a power transformer having a neutral line connected to ground where large currents can flow in the neutral line due to electro-magnetic disturbances. The system includes circuitry for: (a) sensing the current level in the neutral line and whether it exceeds a predetermined threshold for a predetermined period; and (b) sensing and processing the harmonic content of the load current and determining the existence of certain relationships of the “even” and “odd” harmonics. Signals, including alarms, indicative of excessive conditions are produced. The system may also include circuitry for sensing the load current level and generating a signal alarm if the load level is above a given value when the harmonics and the DC current have values in excess of certain predetermined values.