It is common in electric machines to use the housing as a heat sink to remove energy from the electric machine. In some applications, however, the housing receives energy from a hot element. For example, in an electronically controlled turbocharger, the very hot turbine housing radiates and conducts energy to the electric machine housing exacerbating the heating within the electric machine. To reduce the heat transfer into the electric machine, a gap is provided between the stator and the housing outside the stator. In one alternative, the gap is filled with an insulating material. In another embodiment, the gap is an air gap with the stator located within the housing by circumferential rings or axial rods in corresponding grooves. In yet another embodiment, coolant is provided to the gap at the top and drained away at the bottom under the action of gravity.