Essential dignities refer to a planet in a sign and whether the planet is well placed in that sign or not.
The table below I created from information found in the (Arguably the greatest astrology book of all time) Tetrabiblos by Claudius Ptolemy. Any errors are my own.
Initially we are concerned with Rulership, Exaltation, Detriment and Fall.
When a planet is in it’s own sign it is in dignity. A planet functions well here as its urges are in line with the sign. A planet here can most easily express itself.
Example: Venus in Libra (Relating & partners)
When a planet is in the sign of its exaltation it functions well and is in line with the sign meaning. A planet in exaltation expresses intensity of energy.
Example: Saturn in Libra (Responsible & balanced).
When a planet is in the sign opposite its dignity it is in its detriment. This is not a good placement for the planet as its urges can be surpressed and thwarted.
Example: Mars in Libra (needs independence vs. needs of others).
When a planet is in the sign opposite its exaltation it is said to be in its fall. This is a difficult placement, as the planet will struggle to reach its full potential here. A planet here is weak.
Example: Sun in Libra (Individual’s needs vs. partner’s needs).
A planet is peregrine when it does not have any essential dignity. This imparts a neutral energy.
Example: Moon in Libra (but not when the Moon is at 0-9 degrees Libra = face)
Note for the purists A planet is peregrine when it does not have any essential dignity by rulership, exaltation, term, face, detriment or fall.