Four-wire loop requires 2 wires to provide supply voltage to the signal conditioner and 2 wires to convey output signal to the rest of the equipment in the loop.
Four-wire loops are required where the sensor outputs are not suitable for transmission. They provide the greatest degree of flexibility because signal and power return lines are independent and are therefore not limited in power consumption or by signal ground induced errors.
These are the primary reasons for choosing this configuration. However, they do impose a cost penalty as they can not be easily installed using intrinsically-safe techniques and do require extra wiring which is a major cost in instrument loop installation.
For some measurement devices, four-wire loop is the only solution. Moreover, some sensors and most analyzers require too much power and connoting the adoption of the four-wire configurations.