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The diagram in Figure 2 shows a static bypass switch connected across a UPS. The UPS. could be a double conversion or a delta conversion or rotary type. The static bypass switch. provides a means to accomplish high-speed transfer to the bypass path in case of UPS.
The transfer switch works by having a dedicated set of switches for each of the circuits you want to power. Skipping the transfer switch and connecting your generator directly to your electrical service panel could fry appliances, endanger utility workers who might be working on power lines, or damage your generator.