In doubly fed induction generators (DFIGs), the rotor is excited through slip-ring and brush assemblies. These slip-ring and brush assemblies often require frequent routine maintenance, which affects the reliability of the DFIG. Alternatively, a contact-less energy transfer system, such as a rotary transformer, can be utilized in place of the slip rings. In DFIGs, the rotor frequency is very low, under 5 Hz, and this can lead to a huge rotary transformer since the transformer size is inversely proportional to its operating frequency. However, in a rotor-tied DFIG, whereby the rotor is connected directly to the grid whilst the stator is connected to a back-to-back converter, the rotor frequency becomes the grid frequency and can lead to a reasonably sized rotary transformer. In this paper, the design methodology of a three-phase rotary transformer that can be used in rotor-tied DFIG applications is proposed. The rotary transformer is coupled to the power windings of the rotor-tied DFIG and can improve its reactive power capabilities. The proposed methodology is validated with finite element analysis in 3D and can be used for an efficient design process with the proposed error correction. The proposed methodology is then applied in the design of a 6 kVA rotary transformer. Remarkable practical results are presented to demonstrate the effectiveness of the methodology. The rotary transformer is subsequently coupled to a rotor-tied DFIG and an acceptable performance is demonstrated for the entire system.