How to stop battery terminal corrosion
Evaporated / sprayed electrolyte is corrosive. If you see corrosion on the battery posts, the leads, or in the vicinity, that's why. A layer of silicone dielectric grease over the exposed metal parts will protect them. I especially like to get some on the threads of screws in that area, to make sure they come apart easily in the future.
You want as much metal-metal surface area as possible between the battery posts and the terminals. Remember V=IR. which says that as current and resistance increase, so does voltage drop. Resistance is proportional to the cross sectional area of the conductor. So, if you draw a high current through battery leads that don't have much contact area with the posts, you will lose a lot of voltage through that connection (as heat).
So, if you want a really good connection between these metal surfaces, why would you put dielectric (non-conductive) grease in between them? Because these surfaces are not perfectly smooth. At
the high points they touch, and at the low points there are gaps. Dielectric grease will get smooshed in to the gaps, keeping out moisture and electrolyte. You only need a very thin layer here, though.
As metal corrodes it expands. This will push apart the metal-metal contact at the battery posts. So, good to have the dielectric grease to stop that corrosion, and good to apply proper torque to the battery terminal.
The only times cars usually see heavy loads is during starting and immediately after as the battery is recharged. You probably won't see enough heat buildup in that time for it to matter much, until you the battery is old and you try to start on a cold morning. Then the voltage drop across the battery connection will be enough to make it difficult to start.
(It's a much bigger deal with off-grid homes and RVs, where the loads are continuous and the power source is scarce.)Source: mechanics.stackexchange.com