Dielectric grease is non-conductive grease. Because it is non-conductive it does not enhance the flow electrical current. Electrical conductors should not be coated with dielectric grease prior to being mated. However, dielectric grease is often applied to electrical connectors, particularly ones which contain rubber gaskets, as a way to provide a non-conductive lubricant and sealer for the rubber portions of the connector.
The widest use of dielectric grease is in high-voltage connections associated with spark plugs. The grease is applied to the rubber boot of the plug wire. This helps the rubber boot slide onto the ceramic insulator of the plug. The grease also acts to seal the rubber boot, while at the same time preventing the rubber from becoming stuck to the ceramic. Generally spark plugs are in located in areas of high temperature, and the grease is formulated to withstand the temperature range expected.
Another common use of dielectric grease is on the rubber mating surfaces or gaskets of multi-pin electrical connectors used in automotive and truck engines. The grease again acts as a lubricant and a sealant on the non-conductive mating surfaces of the connector. It is not recommended to be applied to the actual electrical conductive contacts of the connector.
In our process of up fitting trucks we coat the completed terminals of junction boxes to reduce the possibility of corrosion to the terminals. We also coat the rear of our toggle switches for the same reason.
Because it doesn't conduct electricity, dielectric grease is used in many electrical applications to ensure a sound metal-to-metal connection. It provides lubrication and protection without adding any significant bulk.