It is related to fault time. The insulation level (133% or 100%) mean running for long time under the correspongding votage. For the high resistance grounded systems, if the fault can recover in a short time like 1 hour, 133% insulation level is enough(as proved by experiment). But if the...
For the example of your attached diagram, when a L-G fault happend in the source side (MV side),there will be a voltage liftup for the grounding, and do harm to LV service device, By seperating the service grounding to different electrod and to a distance,the harm can be reduced to a safe...