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The wire on the back should be hooked to the battery that carries all the current. The other red wire comming out of the plastic plug is the sense wire for the voltage regulator. It provides battery voltage to the regulator for a reference signal.
The black wire should be hooked series throu a warning lamp to the run term. on the ignition switch. It just tells the alt to turn on and light tells you when it is not working. So when you turn on the ign switch power runs throu the light, sense the alt is not turning yet its grounded so the light comes on when the engine starts the voltage equels than the light goes out. hope this makes sense.
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