Phantom power steals and stores power from both the heating and cooling circuits in a super capacitor. This allows for the thermostat to work in applications without a common wire. When the equipment is not running, energy is trickled to charge the super capacitor, when the equipment is running the thermostat is able to steal more power. If you’re looking for a Wi-Fi connected thermostat but do not have a C wire connection, check out the Honeywell Lyric Round Thermostat as it can be powered using this process called Phantom Power or Power Stealing. The AAA battery is provided as backup power for power outages or if the capacitor runs low on power. This allows for the Lyric Round thermostat to work in applications without a C wire.