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Can I eliminate the step-down transformer?

If you design for about 2.2-2.3 volts per cell (all in series) that matches your source voltage AND your size the plates appropriately for the amperage you require (as per BG Book 2) AND you have a direct acting pressure limiting switch (shuts off power when your operating pressure is reached)…
… Then you do not actually need a step-down transformer of any kind (inductive or capacitive).  
You will effectively have a high voltage machine that can run directly (rectified only) from the power source.  
So if I have 120 VAC, I’d use about 54 cells in series and if the electrolyzer meets the above criteria I wouldn’t bother to install capacitive amperage limiting (CAL).
The big advantage to CAL is that you have full gas production when the electrolyzer is cold because you are designing for 2.6 volts per cell (which would cause amperage runaway when the electrolyzer warms up).
If you design for ‘warm’ electrolyzer voltage (2.1 to 2.2 volts per cell), you don’t need amperage limiting but you won’t have full gas production until the electrolyzer warms up.
Unless you use grid-plates.  Grid plates allow cold electrolyzers to operate at ‘warm’ voltages (as well as several other advantages).

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