Loss of an encoder can result in the motor running away unconditionally with brush DC motors or trapezoidal commutated brushless motors. This is a dangerous situation in motion control systems. With Galil sinusoidal brushless servo drives, encoder loss will not cause a runaway condition and it is possible to have an emergency controlled move to a safe position.
A majority of motion control systems that include feedback will use an incremental encoder. The draw back to incremental encoders is that upon power up the controller does not know the position of the motor in absolute terms. To compensate for this, system engineers will home a system upon power up by driving the motor to a switch at a known location.
