Everyday life has been improved immeasurably by the use of electricity which is produced by converting hydro-, thermal- and nuclear-energy by generators in power plants. The photograph shows the type of generator that is widely used in hydroelectric power plant. Electrical steel sheets are used in the iron core of the stator and rotor of the generators. The interaction between electricity and magnetism is used in such electrical equipment as generators, motors, and transformers. Materials capable of efficiently enclosing magnetic flux (called ferromagnetic materials and having high magnetic induction in a magnetic field) are required in order to use this interaction efficiently. The maximum value of magnetic flux density for a material placed in the magnetic field is called the saturation magnetization and is unique to the material. The elements that show ferromagnetism at room temperature are iron, nickel and cobalt, all being transition metals. Of these, iron has the highest saturation magnetization of 2.15 tesla. When a ferromagnetic material is subjected to magnetization by an alternating current, energy losses called iron losses result. Iron losses are of two kinds: hysteresis loss, which occurs due to migration of the magnetic domains in iron, and eddy current loss, which occurs when an eddy current is induced in iron by an alternating current magnetic flux. Electrical steel sheets are required to provide minimized iron losses in addition to high saturation magnetization. Iron has high saturation magnetization and a large eddy current loss due to its low electrical resistance. In 1889, Hadfield of England discovered that the addition of silicon to iron raised electrical resistance and reduced eddy current loss. Minimizing the decline in saturation magnetization by crystal orientation control and maximizing the electrical resistance by the addition of silicon have been the key issues for developing electrical steels. At present, 3% silicon steels are most commonly used for high quality electrical steel sheets.