A few other things to consider regarding bus insulation:
In many locations small rodents may find their way inside the switchgear. The first line of defense is keeping electrical rooms and substations tightly sealed, i.e. not leaving open holes where temporary power cords exit the substation. The second line of defense is "rodent proof" options that some manufacturers offer on their gear. This usually consists of clear plastic over the window where the connected/test/disconnected semaphore is viewed, as well as a movable cover over the holes for racking tools. The third line of defense against rodents is insulated bus.*
There has been some limited testing of insulated bus and it's affect on arcing faults. Keep in mind that none of this affects arc flash calculations per IEEE 1584, however this knowledge is used by manufacturers that produce arc resistant switchgear. When an arcing fault occurs on bare bus or bare overhead conductors the arc travels along the bus away from the largest source of fault current. In LV MCC for example, if an arcing fault starts in a bucket, sometimes it will jump back to the vertical bus, and if the bus is not insulated the arc will travel to the bottom of the vertical bus in that section and remain at the bottom until it is extinguished.
In general, insulation may restrict movement of an arc. In the case of insulated open air conductors the heating effect from the arc is concentrated in one location and tend to burn the conductors down faster than if the arc could travel along the line and spread the heat along a significant length of line.*
Some types of insulation, notably epoxy applied by the fluidized bed process, sometimes will help to extinguish an arcing fault.
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