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This research work explores the feasibility of increasing system reliability by applying condition monitoring systems to selected circuit breakers and transformers. Smart grid technology decreases maintenance costs by deploying condition monitoring systems that informs the operator of impending failures or ameliorates those conditions. Since condition monitoring systems can themselves increase operating costs, only selected critical transformers and circuit breakers are chosen to be equipped with these systems. This paper describes a method to identify the most critical transformers and circuit breakers with the aid of contingency ranking methods. Different summer load cases are studied and the results are compared to find the most severe contingencies that affect the study area. Once the critical components of the system are identified, corrective actions are found for each severe contingency to be applied.