Physics

Power Factor Explained: What It Is, Why It Drops, and How to Correct It

Understand power factor — the ratio of real to apparent power — why it drops in industrial installations, the financial penalties, and how capacitor banks correct it.

CIE Instruments CIE Instruments
· · 8 min read

Power factor is one of the most misunderstood concepts in electrical engineering — and one of the most financially significant for any industrial or commercial electricity consumer in India. A low power factor does not mean equipment is damaged or wiring is wrong. It means the electrical system is carrying more current than the actual work being done strictly requires, and that excess current costs money in losses, in maximum demand charges, and — if DISCOM penalises low PF — in direct surcharges on your electricity bill. Understanding what power factor is, why it goes low, how to measure it, and how to correct it is essential knowledge for any electrical engineer or energy auditor.

What Is Power Factor?

Power factor (PF) is the ratio of real power (the power that does actual work) to apparent power (the total power the supply must deliver). It is a dimensionless number between 0 and 1 (or expressed as a percentage between 0% and 100%).

Power factor definitions
PF = P / S = Real Power (kW) / Apparent Power (kVA)
PF = cos φ (where φ is the angle between voltage and current)
P = Real (active) power in kW — does useful work
Q = Reactive power in kVAR — magnetises inductors and capacitors
S = Apparent power in kVA — what the generator/transformer must supply
φ = Phase angle between voltage and current waveforms

The Power Triangle

Power triangle — P, Q, S relationship
P (kW) Real / Active power Q (kVAR) Reactive power S (kVA) Apparent power φ PF = cos φ = P / S

Pythagoras applies to the power triangle: S² = P² + Q². A unity power factor (PF = 1.0) means Q = 0 — all the apparent power is real power, doing useful work. A power factor of 0.8 means 80% of the apparent power is real, and 20% is circulating reactive power that contributes to losses but does no work.

What Causes Low Power Factor?

Inductive loads draw lagging reactive current — current that lags behind the voltage. This is the primary cause of low power factor in industrial and commercial electrical systems. Capacitive loads cause leading power factor (current leads voltage), which is less common in practice but occurs in lightly loaded cable networks and certain electronic equipment.

Typical power factor by equipment type
Equipment / load type Typical PF Character
Resistive heaters, incandescent lamps 1.00 Unity — ideal
Synchronous motors (over-excited) 0.95–1.00 leading Leading — can self-correct
LED drivers, switch-mode PSU (modern, PFC) 0.90–0.98 Near unity with PFC
Induction motors at full load 0.85–0.92 lagging Lagging — common
Induction motors at half load 0.70–0.85 lagging Worsens as load decreases
Induction motors at no load 0.20–0.40 lagging Very poor — mostly reactive
Fluorescent lights (magnetic ballast) 0.50–0.65 lagging Old technology — poor
Arc furnaces 0.65–0.85 lagging Variable, depends on arc
Welding sets 0.35–0.60 lagging Poor — high reactive draw
VFD-fed motors (with PFC) 0.95–0.98 Near unity at input

Low PF penalty from DISCOMs in India

Most state DISCOMs in India impose a power factor penalty (typically 1–2% surcharge per 0.01 PF below 0.90 or 0.95) on HT consumers and large LT industrial tariff consumers. Some DISCOMs also offer an incentive (rebate) for maintaining PF above 0.95 or unity. Check your DISCOM tariff schedule — the financial impact of poor PF correction is often larger than the cost of the capacitor bank itself.

How to Measure Power Factor

Power factor is measured by a power analyser or power quality meter that simultaneously captures voltage, current, and the phase angle between them. A basic multimeter cannot measure power factor directly — you need an instrument with a power measurement function.

On a three-phase system, use a three-phase power analyser to measure total PF (which may differ from individual phase PF if loading is unbalanced). Record PF at different load levels — light load PF is typically worse than full load PF for induction motor-dominated plants.

Power Factor Correction with Capacitors

The standard method of improving lagging power factor is to install shunt capacitor banks. Capacitors draw leading reactive current, which cancels the lagging reactive current drawn by inductive loads. The net reactive demand seen by the supply is reduced, bringing the apparent power (kVA) closer to the real power (kW).

1
Measure existing PF and kW demand
Record actual kW, kVAR, and kVA at the main incomer over a representative working period.
2
Calculate target kVAR
Use: Q_cap = P × (tan φ₁ − tan φ₂), where φ₁ is present angle and φ₂ is target angle (e.g., for PF 0.95, tan φ₂ = 0.329).
3
Select capacitor bank rating
Choose the nearest standard kVAR rating above your calculated requirement. Add 10% margin for safety and growth.
4
Install at appropriate point
Individual capacitors at motor terminals correct PF at source. A central bank at the main DB corrects the metered demand. Both approaches are used depending on installation size.
5
Verify with measurement after installation
Measure PF at the incomer after installation and across the load cycle. Adjust APFC relay steps if using an automatic capacitor bank controller.

Avoid over-correction

Installing more capacitor kVAR than required causes leading power factor, which can be equally penalised by DISCOMs and may cause voltage rise and resonance problems. Use an automatic power factor correction (APFC) relay-controlled bank, which switches capacitor steps in and out as load varies, maintaining PF near the target value throughout the working day.

Accurate power factor measurement starts with the right instrument. CIE's power quality analysers and clamp meters provide the measurement foundation for a PF correction project. Visit our instruments range or contact our energy measurement specialists for guidance on power quality assessment and correction.

Cambridge Instruments & Engg. Co. · Est. 1963
Looking for an instrument,
not just an answer?
Multimeters, clamp meters, insulation testers, earth testers — manufactured in Howrah, India. Pan-India supply.