Definition

What Is Power Factor Correction?

What is power factor correction? Power factor correction is the practice of improving power factor with a capacitor bank or similar equipment to balance inductive reactive power. The goal is to keep the reactive/active ratio below limits set by the distribution company and prevent reactive charges (penalties). Excessive correction can lead to capacitive reactive penalties.

Why it matters

Motors, transformers, and coil loads produce inductive reactive power; without correction, cos φ falls and reactive penalty risk increases. A correction project is not simply installing capacitors — load profile, shift changes, and seasonal consumption must be analysed using OSOS data. Poorly tuned correction can exceed the capacitive reactive (Rc) limit and cause reverse penalties. Periodic correction maintenance (capacitor failure, shunt reactor tuning) degrades the reactive ratio over time; live monitoring is essential.

Impact on the bill

Reactive ratio = (reactive kVArh / active kWh) × 100. For contracted power below 30 kW, the inductive limit is 33% and the capacitive limit is 20%; at 30 kW and above, inductive is 20% and capacitive is 15%. When limits are exceeded, excess kVArh × unit reactive energy charge is added to the invoice. Subscribers below 9 kW are exempt. The return on correction investment is measured by the monthly reactive penalty avoided; early warning via OSOS before billing reduces cost.

How ENOPTIMAL tracks it

The ENOPTIMAL OSOS module monitors inductive and capacitive reactive ratios live and generates alerts before billing when limits are exceeded. The reactive penalty calculator offers before/after correction scenario projections. In the invoice verification module, reactive line items are cross-checked against the current tariff table. Our Reactive Energy and Reactive Charges guide provides the technical framework for correction design.

Related resources

Frequently asked questions

FAQ

Frequently asked questions about electricity invoices and consumption management.

Are power factor correction and reactive energy the same thing?

No. Reactive energy is the unwanted power component produced by loads; power factor correction is the engineering solution applied to balance it (capacitor bank, etc.).

Is over-correction harmful?

Yes. Excess capacitor capacity produces capacitive reactive (Rc); when the capacitive limit is exceeded, a reactive penalty applies. Correction must be tuned to the load profile.

How often should correction be checked?

Continuous monitoring via OSOS is ideal; at minimum, a monthly reactive ratio report should be obtained. Capacitor failure or load changes can quickly degrade the ratio.

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