G. L. Addenbrooke of the United Telephone Company was the first to arouse Ferranti's practical interest in transformers, and small transformers for telephony were patented jointly by them in 1885 (Patent 14917). There had been difficulty with speech transmission on the first trunk line from London to Brighton due to the inefficiency of the transformers at each end of the line, and Addenbrooke asked Ferranti for advice.
Ferranti pointed out that the transformers had straight magnetic cores and, being familiar with the difficulties that had been experienced at Grosvenor Gallery with such transformers, he suggested that closed magnetic cores should be used, similar to the Zipernowski transformers he had seen at the International Inventions Exhibition of 1885. As a rough and ready demonstration he took two identical circular coils of fine copper wire (actually, shunt coils from his meters), placed them side by side and then bound them together toroidal-fashion with soft iron wire obtained from a florist.
He connected one coil to a 100 volt 50 cycle lighting supply and placed a 100 volt lamp across the other coil. At once the lamp glowed just as brightly as the lamps on the lighting supply thus proving the effectiveness of the transformation. This, of course, was more or less a repetition of Faraday's classical induction experiment in 1831 which had already been developed quite extensively by others, but it set Ferranti's mind working on transformers and the best ways of making and using them.
In a very short space of time he had worked out his ideas and obtained patents 15141 and 15251 of 1885. These two patents, particularly the latter, showed Ferranti's appreciation of the advantages of parallel operation, using transformers with closed magnetic cores in a distribution system of high tension and low tension mains.
Upon his appointment as Engineer of the Grosvenor Gallery Station in January 1886 he brought his ideas to fruition with the far-reaching effects described later.
For the great Deptford enterprise Ferranti built transformers for 10,000 volts, the highest voltage that had ever been attempted, and some of these transformers remained in operation at Trafalgar Square Substation for over fifty years.