This paper presents a novel methodology for condition assessment of oil-paper insulation used in power transformers. The discussed methodology is based on energy acquired by the insulation during polarization process. Existing literature shows that steady excitation voltage is required to be applied to the insulation during polarization current measurement. During polarization, the dipoles in insulating material try to align themselves in the direction of applied field. During orientations process, these dipoles interact with each other which results in frictional loss within the dielectric material. As this loss is supplied by the excitation voltage, an increase in the frictional loss within the dielectric material leads to increment in energy requirement for completion of polarization process within the insulation. Therefore, by evaluating the amount of energy required for completion of polarization process, the condition of an insulating material can be predicted. For testing this hypothesis, three samples having different moisture content are prepared in the laboratory for testing. Once tested on the laboratory samples, the proposed method is applied on data collected from real-life power transformer. Results presented in this paper show that the discussed method can be reliably applied to real life transformers for assessing insulation condition.