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Power Factor (PF) is the ratio of real power to the apparent power flowing to the
load from the source. It is measured between 0 and 1.0 (unity) and is usually
deemed as either leading or lagging, depending on the position of the current
waveform with respect to the voltage.

In an electric power system, a load with a low power factor (tending towards zero)
draws more current than a load with a high power factor (tending towards one) for
the same amount of useful power transferred. The higher currents increase the
energy lost in the distribution system and require larger wires and other equipment.
Because of the costs of larger equipment and wasted energy, electrical utilities will
usually charge a higher cost to industrial or commercial customers where there is a
low power factor. Linear loads with low power factor (such as induction motors)
can be corrected with a passive network of capacitors or inductors. On-linear loads,
such as rectifiers, distort the current drawn from the system. In such cases, active
or passive power factor correction may be used to counteract the distortion and
raise the power factor. The devices for correction of the power factor maybe at a
central substation, spread out over a distribution system, or built into power-
consuming equipment. A high power factor is generally desirable in a transmission
system to reduce transmission losses and improve voltage regulation at the load. It
is often desirable to adjust the power factor of a system to near 1.0. When reactive
elements supply or absorb reactive power near the load, the apparent power is
reduced. Power factor correction may be applied by an electrical power
transmission utility to improve the stability and efficiency of the transmission
network. Individual electrical customers who are charged by their utility for low
power factor may install correction equipment to reduce those costs. Motors driven
by Variable Speed Drives will use the same powers before, but may draw more
current, it should be noted that with reduced stored energy in the DC Bus
capacitors, they may be more vulnerable to power dips

Power factor is the ratio between the useful (true) power (kW) to the total
(apparent) power (kVA) consumed by an item of a.c. electrical equipment or a
complete electrical installation. It is a measure of how efficiently electrical power
is converted into useful work output. The ideal power factor is unity, or one.
Anything less than one means that extra power is required to achieve the actual
task at hand. All current flow causes losses both in the supply and distribution
system. A load with a power factor of 1.0 results in the most efficient loading of
the supply. A load with a power factor of, say, 0.8, results in much higher losses in
the supply system and a higher bill for the consumer. A comparatively small
improvement in power factor can bring about a significant reduction in losses since
losses are proportional to the square of the current. When the power factor is less
than one the ‘missing ‘power is known as reactive power which unfortunately is
necessary to provide a magnetizing field required by motors and other inductive
loads to perform their desired functions. Reactive power can also be interpreted as
wattles, magnetizing or wasted power and it represents an extra burden on the
electricity supply system and on the consumer’s bill. A poor power factor is
usually the result of a significant phase difference between the voltage and current
at the load terminals, or it can be due to high harmonic content or a distorted
current waveform. A poor power factor is generally the result of an inductive load
such as an induction motor, power transformer, and ballast in a luminaire, a
welding set or an induction furnace. A distorted current waveform can be the result
of a rectifier, an inverter, variable speed drive, a switched mode power supply,
discharge lighting or other electronic loads. A poor power factor due to inductive
loads can be improved by the addition of power factor correction equipment, but a

Fig. Input Power Vs. Output Power

poor power factor due to a distorted current waveform requires a change in

equipment design or the addition of harmonic filters. Some inverters are quoted as
having a power factor of better than 0.95 when, in reality, the true power factories
between 0.5 and 0.75. The figure of 0.95 is based on the cosine of the angle
between the voltage and current but does not take into account that the current
waveform is discontinuous and therefore contributes to increased losses. An
inductive load requires a magnetic field to operate and in creating such a magnetic
field causes the current to be out of phase with the voltage (the current lags the
voltage). Power factor correction is the process of compensating for the lagging
currently creating a leading current by connecting capacitors to the supply. A
sufficient capacitance disconnected so that the power factor is adjusted to be as
close to unity as possible. (Huber and Borojevic 1995)


The benefits that can be achieved by applying the correct power factor correction
 Environmental benefit. Reduction of power consumption due to improved
energy efficiency. Reduced power consumption means less greenhouse gas
emissions and fossil fuel depletion by power stations.
 Reduction of electricity bills.
 Extra kVA available from the existing supply.
 Reduction of I2R losses in transformers and distribution equipment
 Reduction of voltage drops in long cables.
 Extended equipment life – Reduced electrical burden on cables and
electrical components


Power factor correction is achieved by the addition of capacitors in parallel with
the connected motor or lighting circuits and can be applied at the equipment,
distribution board or at the origin of the installation. Static power factor correction
can be applied at each individual motor by connecting the correction capacitors to
the motor starter. A disadvantage can occur when the load on the motor changes
and can result in under or over correction. Static power factor correction must not
be applied at the output of a variable speed drive, solid state soft starter or inverter
as the capacitors can cause serious damage to the electronic components. Over-
correction should not occur if the power factor correction incorrectly sized.
Typically the power factor correction for an individual motor is based on the non-
load (magnetizing) power since the reactive load of a motor is comparatively
constant compared to actual kW load over compensation should be avoided. Care
should be taken when applying power factor correction star/delta type controls that
the capacitors are not subjected torpid on-off-on conditions. Typically the
correction would be placed on either the Main or Delta contactor circuits. Power
factor correction applied at the origin of the installation consists of a controller
monitoring the VA’s and this controller switches capacitors in or out to maintain
the correction is installed, other loads can in theory be connected anywhere on the
network. Power factor better than a preset limit (typically 0.95).Where ‘bulk’
power factor
Shunt capacitors are used in rating from 15KVAR to 10000 KVAR . Small
bank of capacitors, up to a few hundred KVAR rating are used to an individual
distribution capacitor circuit of costumers. Capacitor bank of 500-3000 KVAR are
used in small distribution substations and those with still larger rating n larger
Capacitors are installed either in groups at once central location , at the primary or
the secondary of transformer or individually on each motor or brunch circuit
feeding group of motors ,They are arranged in 3-phase banks connected n star or
It is not economical to raise the power factor to unity for the following reasons:
1-If the power factor is improved to unity for full load conditions, the PF would
become leading the load is less than full load (unless some capacitors are switched
off which is generally difficult).
2-As the PF approaches unity, the capacity of power improvement device increases
more rapidly e.g. the PF of an installation can be improved from 0.8 to 0.9 by
much smaller capacitive KVAR than which will be needed to raise PF from 0.9 to
3-Improvement in PF means a reduction in KVA charge. However installation of
PF improvement devices needs capital investment. The PF should be improved to
such an extent that the saving is maximum.
When the KVAR is small, it can be met through static capacitor. However


Many engineers are oblivious to the effects of low power factor. They view it only
as a direct charge on their electrical bill, and only when stated as such. Low power
factor is a direct cost to the utility company and must be paid for. Direct costs of
low power factor Power factor may be billed as one of or combination of, the
1) A penalty for power factor below and a credit for power factor above a
predetermined value,
2) An increasing penalty for decreasing power factor,
3) A charge on monthly KVAR Hours,
4) KVA demand: A straight charge is made for the maximum value of KVA used
during the month. Included in this charge is a charge for KVAR since KVAR
increase the amount of KVA. Indirect costs of low power factor Loss in efficiency
of the equipment: When an installation operates with a low power factor, the
amount of useful power available inside the installation at the distribution
transformers is considerably reduced due to the amount of reactive energy that the
transformers have to carry. The figure below indicates the available actual power
of distribution equipment designed to supply 1000 KW.
Equipment Creating Poor Power Factor
 Low Voltage Capacitor Units
A low voltage capacitor unit is built up of several elements connected in parallel.
an element consists in principle of two electro-des and dielectric. The elements are
made of metallized plastic film and inserted into aplastic cover. Unlike capacitors
made of aluminum foil or metallized paper, metallized-film capacitor-tors are
generally dry without impregnation liquid .The elements of metallized-film
capacitators are self-healing. After a disruptive discharge, a thin metallized layer
will vaporize off from the surface around the breakdown point, and no permanent
short-circuit will be left there. Elements are internally protected to ensure a reliable
disconnecting at the end of the lifecycle. Elements are set into a steel container a
connected to the terminals of the capacitor by means of copper bus bars and cables.
Capacitor losses are very low, less than 0.5 watts per Kvar.
Most low voltage capacitors are equipped with external discharge resistors so as to
decrease the residual voltage of the capacitor from an initial value of √2 times the
rated voltage Un to below the level of ≤ 50 V within1 minute. Low voltage
capacitors are normally three-phase with three bushings on the cover and star or
delta connected internally. Among the unit sizes available for the most common
voltage range 400...690 V are2.5, 5, 7.5, 10, 12.5, 15, 20, 25, 30, 40, 50, 60,75, 90
and 100 kvar, and the capacitance
 Fixed Low Voltage Capacitor Banks
Fixed capacitor banks consist of parallel connected units installed in a rack. The
bank is fitted with a cable connection box. The ca-acutance tolerance of a bank is –
0...+10 %.Due to the large inrush current of a fixed bank, slow acting fuses
dimensioned for 1.7times the rated current must be used. Ac-cording to general
standards, the connection cable must be able to carry a continuous load of 1.43
times rated current.
 Automatically Controlled Low Voltage Capacitor Banks
Automatically controlled capacitor banks are equipped with fuses and contactors
con-trolled by a power factor controller, on which desired target value of power
factor (cosϕ) and inductive and capacitive operating limits can be set. The level of
reactive power is monitored by means of current transformers and the power factor
controller switches capacitors on and off according to demand. A single step may
comprise either one or several capacitor units; in the latter case these conduit is
controlled via an auxiliary con-tact on the contactor of the first unit and so on. In
this way a time lag equal to the operating time of the contactor is introduced and
the overall inrush current is thus reduced. Very large banks are usually divided into
smaller subgroups, each with an individual connection cable and main fuses but
with a common power factor controller. The main fuses should be slow acting and
dimensioned for 1.38 times rated current.
It is useful to have an idea of the value of the power factor of commonly used
electrical equipment. This will give an idea as to the amount of reactive energy that
the network will have to carry. Find below is the summary of power factor of
commonly used electrical equipment.
 Lighting
Incandescent Lamps: The power factor is equal to unity. Fluorescent Lamps:
Usually have a low power factor, for example, 50% power factor would not be
unusual. They are sometimes supplied with a compensation device to correct low
power factor. Mercury Vapor Lamps: The power factor of the lamp is low; it can
vary between 40% to 60%, but the lamps are often supplied with correction
 Distribution Transformer
The power factor varies considerably as a function of the load and the design of the
transformer. A completely unloaded transformer would be very inductive and have
a very low power factor.
 Electrical Motors
Induction Motors: The power factor varies in accordance with the load. Unloaded
or lightly loaded motors exhibit a low power factor. The variation can be 30% to
90%.Synchronous Motors: Very good power factor when the excitation is properly
adjusted. Synchronous motors can be over excited to exhibit a leading power factor
and can be used to compensate a low power system.
 Industrial Heating
With resistance, as in ovens or dryers, the power factor is often closed to 100%.
 Welding
Electric arc welders generally have a low power factor, around 60%.Other types of
machinery or equipment those are likely to have a low power factor.


PFC is the term given to technology that has been used since the turn of the20th
century to restore the power factor to as close to unity as is economically viable.
This is normally achieved by the addition of capacitors to the electrical network
which compensate for the reactive power demand of the inductive load and thus
reduce the burden on the supply. There should be no effect on the operation of the
equipment. To reduce losses in the distribution system, and to reduce the electricity
bill, power factor correction, usually in the form of capacitors, is added to
neutralize much of the magnetizing current as possible. Capacitors contained in
most power factor correction equipment draw current that leads the voltage, thus
producing a leading power factor. If capacitors are connected to a circuit that
operates at a nominally lagging power factor, the extent that the circuit lags is
reduced proportionately. Typically the corrected power factor will be 0.92 to 0.95.
Some power distributors offer incentives for operating with a power factor of
better than 0.9, for example, and some penalize consumers with a poor power
factor. There are many ways that this is metered but the net result is that in order to
reduce wasted energy in the distribution system, the consumer is encouraged to
apply power factor correction. Most Network Operating companies now penalize
for power factors below 0.95 or 0.9.
There are two main methods for power factor correction: passive power factor
correction and active power factor correction. Passive PFC is the simpler route of
the two. It is generally done by introducing an inductance to a system to counteract
the reactive current due to capacitance. Recall that inductors introduce positive
reactive power while capacitors introduce negative reactive power. So if there is a
large capacitive value associate with a system, there will be large amount of
negative reactive power. Introducing an inductance to the system will counteract
this effect by bringing the negative reactive power back towards zero.
Active PFC involves using complex circuitry to counteract the effects of the
reactive components. Such a discussion is beyond the scope of this paper but the
concept is similar to the tug of war reference. Most power sources and systems
manufactured presently utilize active power factor correction. The reason is
because once a source or system reaches a certain size (over about 200-250VA),
the inductor necessary for passive PFC becomes too large for a feasible design.


There are several advantages in utilizing power factor correction capacitors.
These include:
Most 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. Increasing the power factor will, therefore, lower the demand charge.
Loads drawing reactive power also demand reactive current. Installing 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. 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.
What is the difference between fixed and automatic Power Factor Correction
Capacitors? Fixed capacitor banks are “on” at all times, regardless of the load in
the facility, while an automatic capacitor bank varies the amount of correction
(KVAR) supplied to an electrical system. An automatic capacitor is much more
expensive per kVAR (3 to 5 times) than a fixed system.100 kVAr of fixed
capacitors will save as much power factor penalties as a 100 kVAr automatic
capacitor. Generally, when a capacitor is connected to a system there is a reduction
in amperage on the system (the lower the power factor the greater the KVA
reduction). This reduction in amperage reduces the voltage drop across a
transformer, which results in a higher voltage in the system. If 100 kVAr is
connected to a1000 KVA transformer, there is approximately a ¾% voltage rise on
the system (if there are no other loads on the system). The more kVAr connected,
the higher the voltage rise. This voltage rise is counter acted by the increase of load
in the facility. Typically, in the night and on weekends, utility voltage is higher
than normal, and facilities that are not normally loaded during these times, could
experience a higher than normal voltage rise if too much capacitance is connected
to their system. Based on this, we generally limit fixed capacitors to 10% to 15%
fixed kVAR to KVA of transformer size. We would recommend an automatic
capacitor bank if the amount of kVAR exceeds 20% of the KVA size of the



The pros and cons of correcting power factor are dependent on the types of loads
found within each facility. For a building that has large harmonic generating loads,
such as a server farm, or one that needed power with extremely low levels of
harmonic distortion, such as a hospital, a system located near the service entrance
that employed harmonic mitigation might be preferable. Still, most facilities that
we have seen do not need this type of “ultra-clean” power, have primarily
displacement power factors resulting from motors, and also have lower levels of
harmonics. In these cases, “At Load” correction has two major advantages over the
service entrance systems. They are:

• Shorter return on investment. Even though the initial cost of the At Load
system will be higher than the cost of the Service Entrance system, the savings are
greater. The service entrance system will only save the customer on Var charges,
while the “At Load” system will reduce both demand and usage charges by
approximately two percent every month. In addition, the decreased usage after the
meter, obtained with the “At Load” system, also decreases the generation
requirements of the utility. In the longer term, if widely adopted, these reduced
costs will eventually be reflected in customer bills. The reduced operating costs
also lead to a shorter return on investment. The additional installation and
equipment costs of larger “At Load” systems (>150 Kvar) will be recovered within
the first six to eight months. With smaller services, where service entrance systems
would not be cost effective because of the high cost, “At Load” systems will still
generate savings to offset the investment within a relatively short time period.

• Fewer harmonics. As demonstrated in Section 6, there are fewer harmonics

created with the distributed capacitance of the “At Load” systems than with the
larger, concentrated capacitance of the service entrance systems. This also reduces
costs, both by generating fewer harmonics that might damage equipment, and by
lessening or eliminating the need for expensive harmonic mitigation systems.

To improve the load-power factor of the electrical power system, the common
practice is to add shunt-connected capacitors at the main substation to correct for
the inductive loads (transformers, motors, etc.). Although shunt-connected
capacitors may improve the power factor, they may also create serious problems,
particularly when harmonics are present. Any capacitance and inductance forms a
circuit tuned (capacitance and inductive reactance are equal) to what is called the
"resonant" frequency. If enough harmonic energy is present and its frequency
matches that of the resonant circuit, then a very large current (many times the
original harmonic current) will flow. This current will produce extreme voltage
drops across all circuit elements, blowing fuses, damaging components, and
deflecting an excessively high harmonic level back into the power system.
Resonance often occurs when shunt capacitors are located near a harmonic current
source and, thus, create a parallel resonant circuit with the equivalent
Power Factor in Power System with Harmonics
In power systems which contain nonlinear loads, there are essentially two power
factors; the “displacement power factor” (i.e., the power factor of the fundamental
component) and the “true power factor”, which is a measure of the power factor of
both the fundamental and harmonic components in the power system.

FIG .Power
Components in
System with
PFC is rapidly becoming a mandatory feature in AC power sources because IEC
6100-3-2 requires the use of PFC circuits. Active and passive PFC circuits are
designed to bring the PF of a system closer to unity (PF = 1.0). While no system is
100% efficient, most PFC technology makes the power factor of a system greater
than 0.95. Highly efficient electrical systems have the advantage of supplying less
current to drive a load. This is beneficial to customers that have low power factor
problems because utilities sometimes charge penalties for low power factor. While
cost savings from PFC on small AC sources isn’t nearly as noticeable as money
saved from PFC on large systems, in the long run PFC will provide reduced costs
for high energy consumers.

[1] Huber, L. and D. Borojevic (1995). "Space vector modulated three-phase to

three-phase matrix converter with input power factor correction." IEEE
transactions on industry applications 31(6): 1234-1246.

IEEE Recommended Practices and Requirements for Harmonic Control in Power

Systems. (1992).
IEEE. ISBN 1-55937-239-7.

IEEE transactions on power apparatus and systems.