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Solid state electronics is used to increase the energy efficiency of electrical load devices. The harmonic distortion of current is increasing with the enhanced use of nonlinear loads i.e. solid state devices. Examples of nonlinear loads are personal computer, laptop, laser printer, fax machine, television set (TV), fluorescent tube with electronic ballast, compact fluorescent lamp, battery charger, adjustable speed drives, uninterrupted power supply (UPS) and any other equipment powered by switched-mode power supply (SMPS) unit. These nonlinear loads draw more current than the fundamental current and cause overloading of the components of the distribution system. Transformers are major components of the distribution system and are mainly affected by this overloading. This leads to higher losses, reduces the strength of insulation and consequently leads to reduction of useful life of the transformer. Aging of transformer increases due to overheating caused by overloading. This paper presents the results of a case study of aging of transformer caused by harmonics due to non linear loads. Here two transformers of 500 kVA and 100 kVA are considered which supply a technical institution and residential campus respectively. The harmonic currents produced by these loads are captured in the laboratory and their effect on transformers is studied. An attempt has been made to calculate the energy loss due to harmonic distortion caused by these nonlinear loads. The rise in operating temperature due to harmonic current and hence life expectancy of the transformers are calculated.