Hi Gary,
The simple answer to your question is the basic definition of dielectric: “An insulator that can store a static electric charge.” Why would we want an insulator between two terminals in an electrical connection?
The ideal connection between two or more terminals is gas-tight with zero-resistance. Any non-conductive substance between the terminals can add resistance. This is less of an issue in applications such as bayonet-base light bulbs that slide into position, scraping grease away from the contact points. And bulbs rely on relatively high-current high-voltage power, so a little added resistance is not typically an issue.
But in applications such as ground points, where ring terminals and washers are sandwiched together, any grease, dielectric or conductive, will be squashed and trapped between the conductors, potentially adding significant resistance to the connection. And ground points complete sensitive circuits such as those for sensors where differences of hundredths of a volt can prompt the engine management system to change fueling, ignition timing, etc.
Even conductive greases typically have conductivity that are orders of magnitude lower than those of the metals commonly used in automotive connectors (gold, silver, copper, brass, aluminum). So I am not personally an advocate of using conductive greases.
My personal approach is to clean connectors and ground studs with a brass-bristle or fiberglass-bristle brush, flush with zero-residue electronic contact cleaner, allow to dry or use compressed air, secure the connection, then apply dielectric grease over the assembled connection. For plastic connectors, I will sometimes apply dielectric grease around the outside of the smaller/inner half of the connector so it helps seal the two halves of the housing. But I do not apply dielectric grease to the terminal pins inside the connector.
You’ll find plenty of dissenting opinions, but here’s a recent story to back up my approach: a friend brought his Range Rover to me because a transmission warning lamp was illuminated. I scanned for DTCs, which indicated a problem with a transfer case sensor. I inspected the connectors at the transfer case and found all the connectors full of dielectric grease. He said the last place to service the transmission was an AAMCO shop, so they probably added the grease. I cleaned the connectors using brushes and two cans of contact cleaner. I cleared the codes, and the codes have not recurred.
Another example is that back when spark plug manufacturers recommended the use of anti-seize compound on plug threads, their instructions were to apply the compound to only a small portion of the threads so most of the threads were bare to make good contact with the cylinder head (which is the ground path for spark). Since most anti-seize compounds contain conductive particles (copper or aluminum), they are far more conductive than dielectric grease, yet plug manufacturers made it clear that applying these metal-bearing compounds to the entire threaded section of a plug could cause problems with the performance.
Cheers,
Don
