Why You Need Power Factor Improvement

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In a typical industrial plant, AC induction motors constitute a large portion of the equipment. Since induction motors are mainly inductive loads, they are likely to lead to a low power factor. Some of the benefits of improving your power factor include:

Lower Utility Fees
Inductive loads, which require reactive power, are the main cause of a low power factor. This increase in required reactive power (KVAR) causes an increase in required apparent power (KVA), which is what the utility company supplies to your facility

So, a facility’s low power factor causes the electricity company to have to increase its generation and transmission capacity in order to handle this extra demand. By lowering your power factor, you use less KVAR. This results in less KW, which equates to a dollar savings from the utility company. Also note that a utility company will charge any consumer whose power factor is less than 0.95 an additional fee. If you reduce power factor you can avoid this additional fee.

Increased System Capacity
By improving power factor, the KW capacity of the system is increased. This implies that for a given KVA, as we improve power factor, the reactive power component, KWAR, decreases and the KW component increases.

Reduced System Losses
As current flows through conductors, the conductors produce heat. This heating is power loss. Power loss is proportional to current squared (PLoss =I2 R) and current is proportional to the power factor. In any given electrical distribution system, Conductor loss can account for as much as 2-5% of total load.
By improving your power factor, these losses can be reduced. With the current rise in the cost of energy due to ever increasing fluctuations in the price of crude oil, increased facility efficiency is very desirable. And with lower system losses, you are also able to add additional load to your system.

Increased Voltage Level and Cooler and More Efficient Motors
Uncorrected power factor causes power system losses in the distribution system. As power losses increase, voltage drops. Excessive voltage drops can cause overheating and premature failure of motors and other inductive equipment.
By improving the power factor of your plant, you will minimize these voltage
drops along feeder cables and avoid related problems. Your motors will run cooler and be more efficient, with a slight increase in capacity and starting torque. Also note that Severe over-correction (P.F. greater than 1) will cause a voltage rise that can damage insulation & equipment; or result in utility surcharges!