### Power Factor

##### What is Power Factor

Power factor is the phase difference between the voltage and current. If the current leads the voltage it is called leading power factor. It occurs when there is a reactive power generation near the load. If the current lags the voltage, it is called lagging power factor. It occurs when there is a reactive power absorption by the load. Normally the leading power factor is prevented while lagging power factor is allowed to a certain extent.

Power factor (PF) is an expression of energy efficiency. PF is the ratio of working power to apparent power. Apparent power, also known as demand, is the measure of the amount of power used to run machinery and equipment during a certain period.

PF expresses the ratio of true power used in a circuit to the apparent power delivered to the circuit.

##### What is Power Factor Correction?

Power Factor Correction (PFC) is a technology that, when installed, allows you to reduce your electricity bill by maintaining the level of reactive power consumption. If the power factor falls below a predetermined figure at a plant or site, then the electricity company will add reactive power charges to your bill. Typically, there is not a lot of strain on electrical infrastructure if the power factor used is suitable.

##### Why is having a power factor so essential?

With power factor, you can measure how efficiently you are consuming electricity. Different kinds of power are used at a site or plant that provides you with electrical energy. To make it easier for you, let us tell you how each one of them functions.

First, working power is the power that is used in all electrical appliances that perform the job of lighting, heating, motion, amongst others. It can be denoted as kW or Kilowatts. Some common types of resistive loads are lighting and electric heating. Then comes an inductive load like a compressor or ballast, they also need reactive power to generate and sustain a magnetic field which is necessary for it to operate. It is also known as non-working power kVAR, or kilovolt-amperes-reactive, technically.

Whether it is a site or your home, both consist of resistive and inductive loads. However, the ratio between the two is crucial as these kinds of loads hold utmost value, when you add more inductive equipment.

Beer is active power (kW)—the useful power, or the liquid beer, is the energy that is doing work. This is the part you want.
Foam is reactive power (kVAR)—the foam is wasted power or lost power. It’s the energy being produced that isn’t doing any work, such as the production of heat or vibration.
The mug is apparent power (kVA)—the mug is the demand power, or the power being delivered by the utility.

If a circuit were 100% efficient, demand would be equal to the power available. When demand is greater than the power available, a strain is placed on the utility system. Many utilities add a demand charge to the bills of large customers to offset differences between supply and demand (where supply is lower than demand). For most utilities, demand is calculated based on the average load placed within 15 to 30 minutes. If demand requirements are irregular, the utility must have more reserve capacity available than if load requirements remain constant.

Peak demand is when demand is at its highest. The challenge for utilities is delivering power to handle every customer’s peaks. Using power at the very moment it is in highest demand can disrupt overall supply unless there are enough reserves. Therefore, utilities bill for peak demand. For some larger customers, utilities might even take the largest peak and apply it across the full billing period.

Utilities apply surcharges to companies with a lower power factor. The costs of lower efficiency can be steep—akin to driving a gas-guzzling car. The lower the power factor, the less efficient the circuit, and the higher the overall operating cost. The higher the operating cost, the higher the likelihood that utilities will penalize a customer for overutilization. In most ac circuits there is never power factor equal to one because there is always some impedance (interference) on the power lines.