For forest-products-based industries, the significant benefits of preemptive arc-flash protection and online condition monitoring of electrical equipment are not well known. This paper provides a summary of the research surrounding the development and testing of new advanced sensor technologies for this purpose. This paper builds on the authors' initial research and their supporting publications providing more extensive and detailed field measurements supporting the preemptive detection of significant defects that can lead to an arc-flash event. The early detection of impending faults and the prediction of future arc-flash occurrences in medium voltage (MV) switchgears and motor control centers (MCCs) can be very beneficial. The development of new sensor technologies both for partial discharge measurement and thermal detection are discussed and evaluated. The two most common noncontact causes leading to an arc-flash event in MV switchgears and MCCs are insulation degradation and thermal stresses. This paper will highlight very detailed results measured under both of these conditions in laboratory and actual installed conditions. An effective signal processing method, which is used for extracting the essential indication data and for the integration of this system into existing protection programmable logic control or supervisory control and data acquisition (SCADA) systems, is outlined.