I do think it is a very complex subject – certainly beyond my understanding. And in the end, some of the answers depend on opinions (Practices are not completely standardized).
Here are some excerpts from IEEE 62.21. The whole document is long and complicated and I can't say I have read the whole thing or understand the whole thing. After each excerpt, I will suggest some conclusions that you MIGHT draw from the excerpt, but of course without reading the whole thing we need to be careful.
IEEE62.21 said:
In addition, a survey of several thousand motors in industrial service showed that few were equipped with surge protection, and there was almost no evidence of failure due to absence of surge protection. A survey by WG 3.4.9 of Surge Protective Devices Committee found (from a small sample of utility installations) that surge protective capacitors were failing at about the same rate as those motor insulation failures that were not caused by overheating. It was also recognized that capacitor leads as usually installed, and even when of quite short lengths, have sufficient inductance to prevent the capacitor from protecting the machine from steep-front surges. Motor starting surge fronts as short as 200 nanoseconds had been measured.
From this quote along, we might conclude that surge protection is not particularly important. The number of surge device failures from adding surge protection is roughly equal from number of motor failures eliminated by adding surge protection.[/QUOTE]
IEEE62.21 said:
For a particular machine installation a quantitative evaluation such as is presented in this guide is required to determine whether protective coordination with the insulation withstand is achieved.
This quote is probably the most relevant one. IT TELLS US WE CANNOT MAKE SWEEPING GENERALIZATIONS. WE NEED TO EVALUATE THE SPECIFIC INSTALLATION. THE GUIDE GIVES VERY DETAILED EVALUATION METHOD.
IEEE62.21 said:
capacitor internal inductance plus the inductance of leads as long as one meter can isolate the capacitor from the motor during steep-front starting surges, and may not be effective in wavefront sloping [B42]. Surge arrester lead length is not as critical when machine protective arresters are applied together with short lead length capacitors, because the capacitors will lengthen the rise time applied to the arrester lead inductance.
It seems more acceptable to extend the ARRESTER lead length than the CAPACITOR lead length.
IEEE62.21 said:
[Example of using the "look-up method" in section 6.3.2]
Using Figure 9—To limit the 85 ns surge peak that is caused by inductance of the capacitor and capacitor leads to 2.0 pu, the ordinate value on an interpolated 85 ns curve must be no greater than (2.0 / 2.6) = 0.77 pu. This occurs at about 2.0 ìH. (For interpolation, see next paragraph.) Subtracting the 0.5 ìH of the capacitor, the leads must have an inductance of 1.50 ìH or less. At 1.25 ìH/m, the capacitor lead length should not exceed 1.2 m (1.50ìH / 1.25ìH/m = 1.2 m). To provide protective margin, shorter is better. [FOR THIS SPECIFIC EXAMPLE]
Again, this refers only to one particular analysed situation. For this situation, a max capacitor lead length of 0.5m was calculated. Shorter capacitor lead lengths are better. I would suspect that the shorter is better part generalizes accross a wide range of examples, and I think historical practice is simply to get them as close as practical, without detailed analysis of lead length requirements.
One other factor about the ability of the motor to withstand surges - In addition to the "dedicated turn insulation" mentioned above, there are 2 flavors of large motors that you can purchase under NEMA standards: 2.5 p.u. surge withstand and 3.5 p.u. surge withstand.
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