Question

What is the difference between second generation and third generation​

Answer 1

These were later renamed to "Specialized Technology" and "Simscape Components" to help explain this difference.

Specialized Technology (Second Generation) is a Simulink based library and has been around for longer. It can still connect to Simscape, but in the same way you can connect Simulink models to Simscape -- that is, you need converters and sometimes to break algebraic loops, etc. It also has more dedicated electrical power systems capabilities. If your model will be only power systems, and especially if it's a larger model, I'd recommend this one.

Simscape Components (Third Generation) is built using the Simscape language and therefore connects directly with other Simscape blocks. If you plan to use other Simscape domains like mechanical, hydraulic, etc. I'd recommend this one.