Power factor penalty: paying for power you never used.

What power factor means

Motors, transformers and welding sets need two kinds of power. Active power (kW) does the useful work. Reactive power (kVAr) builds the magnetic fields those machines need to run, then flows back and forth without doing any work. Together they make up apparent power (kVA) — what your cables, transformer and the grid actually carry.

Power factor (PF) is the ratio of the two: kW ÷ kVA. At 1.00, every kVA does useful work. At 0.85, the supply carries about 18% more current than the work needs.

Four ways low power factor reaches your bill

Which of these applies depends on your state and tariff category — many plants face more than one.

• A PF surcharge. On kWh-billed tariffs, a surcharge usually applies when average PF falls below a threshold, commonly somewhere between 0.90 and 0.95. Some tariffs also give an incentive above it.
• More billed units. On a kVAh tariff, the units billed are kWh ÷ PF, so every point of PF lost becomes extra units on every hour of the month — no separate penalty line needed.
• A higher demand charge. Where demand is billed in kVA, low PF raises Maximum Demand and eats into your Contract Demand headroom.
• A reactive energy charge. Some tariffs bill reactive energy (kVArh) as its own line, so the cost shows up as a separate charge.

What it costs on a kVAh or kVA tariff

The same 400 kW of useful load, at different power factors:

kVA = kW ÷ PF. Extra units compare billed kVAh with PF 1.00 for the same kWh. Surcharge thresholds and rates differ by state, DISCOM and consumer category. Work out your own bill with the PF penalty calculator.

What drags power factor down

• Lightly loaded motors and transformers. They draw almost the same reactive power at light load as at full load, while active power falls.
• Ageing or failed capacitors. Capacitors lose kVAr over the years, and a blown fuse or failed contactor can take a whole step out without anyone noticing.
• APFC panel faults. A controller stuck in manual, a wrong CT connection or a wrong target setting leaves correction doing less than it appears to.
• New loads, old correction. Capacitor banks sized years ago rarely match a plant that has since added machines.
• Harmonics. Drives, rectifiers and UPS systems distort current. That lowers true power factor and can overload capacitors that were never designed for it.

Overcorrection: the leading side

Correction sized for full load can push power factor leading when the plant runs light — at night, on holidays, between shifts. Many kVAh tariffs count leading reactive energy too, so overcorrection can cost money just like undercorrection. The aim is not maximum capacitance; it is PF close to 1.00 at every load.

How plants fix it

• Measure PF per panel, not only at the incomer. One average hides which feeder is pulling it down.
• Check capacitor health. Measure the current in each step against its rating; replace weak units before they fail outright.
• Correct close to the load. Fixed capacitors at large, steadily running motors take the load off the main bank.
• Keep the APFC in auto, with small enough steps to follow light-load hours.
• Use detuned or filter banks where drives and other non-linear loads are significant.
• Review after every major load change.

How KONDUKTOR® EMS helps

KONDUKTOR® EMS reads the multifunction meters already on your panels and shows live power factor for every meter against a 0.95 target, with lead or lag marked.

• Low-PF alerts tell your team the moment a panel slips, instead of at the end of the month.
• The power factor optimiser estimates the capacitor kVAr needed to reach your target and the rupee saving it would bring.
• History by shift and by panel shows when PF drops, and where — so the fix goes to the right feeder.