In electrical plants the loads draw from the network (active power) as a power supply source (for example in personal computers, printers, diagnostic equipment, etc.) or convert it into another form of energy (such as electrical lamps or stoves)or into mechanical output (electrical motors and fans).To get to these forms of energy, it is often necessary that the load exchanges with the network (with net null consumption) the reactive energy, mainly of inductive type but in some cases capacitive. This energy, even if not immediately converted into other forms, contributes to increase the total power flowing through in the electrical network, from the generators, all along the conductors, to the users but is not converted into usable energy.

This is a disadvantage to the power provider, lines company and end user – especially as it increases the user’s maximum demand and associated charges, as well as excess kVAR usage charges.To smooth this negative effect, power factor correction of the electrical plants and equipment must be carried out.

Power factor correction obtained by using capacitor banks to generate locally the reactive energy necessary for the transfer of electrical useful power.

Moreover, the present spreading of direct current users, such as electronic circuits and electric drives, involve the generation of current harmonics which are injected into the network, with the consequent pollution and distortion of the waveforms on other connected loads. Therefore, the use of harmonic filters, both of passive as well as of active type, contributes to improve the overall powerquality of the network, carrying out also power factor correction at the network frequency, when such filters are properly sized.


There are numerous benefits to be gained through power factor correction. These benefits range from reduced demand charges on your power system to increased load carrying capabilities in your existing circuits and overall reduced power system loses. And the benefits of power factor correction aren’t just limited to the balance sheet; there are also huge environmental benefits associated with power factor correction, which means your company is reducing it’s carbon footprint and helping the environment.

    Vector and other electric utility companies charge for excess kVAr’s consumed under a power factor of 0.95. For medium-level power consumers, this can mean thousands of dollars per month in fees if the site has not installed power factor correction or existing power factor correction units are undersized/not functioning. Pay off times for installing power factor correction can be as low as 12 months.
    Most electric utility companies charge for maximum metered demand based on either the highest registered demand in kilowatts (kW meter), or a percentage of the highest registered demand in kVA (kVA meter), whichever is greater. If the power factor is low, the percentage of the measured kVA will be significantly greater than the kW demand. Improving the power factor through power factor correction will therefore lower the demand charge, helping to reduce your electricity bill.
    Loads drawing reactive power also demand reactive current. Installing power factor correction capacitors at the end of existing circuits near the inductive loads reduces the current carried by each circuit. The reduction in current flow resulting from improved power factor may allow the circuit to carry new loads, saving the cost of upgrading the distribution network when extra capacity is required for additional machinery or equipment, saving your company thousands of dollars in unnecessary upgrade costs. In addition, the reduced current flow reduces resistive losses in the circuit.
    A lower power factor causes a higher current flow for a given load. As the line current increases, the voltage drop in the conductor increases, which may result in a lower voltage at the equipment. With an improved power factor, the voltage drop in the conductor is reduced, improving the voltage at the equipment.
    Although the financial return from conductor loss reduction alone is seldom sufficient to justify the installation of capacitors, it is sometimes an attractive additional benefit; especially in older plants with long feeders or in field pumping operations. System conductor losses are proportional to the current squared and, since the current is reduced in direct proportion to the power factor improvement, the losses are inversely proportional to the square of the power factor.