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While most contractors know what power factor is, explaining it to the senior personnel among customers is sometimes tricky.

With that in mind, here is a simple way to unravel the issue.

The Power Factor: Basic Concepts

Power factor is the ratio of 'useful power' to 'total power' consumed by electrical equipment.

Any electrical equipment requiring the creation of a magnetic field to operate - such as AC motors, induction heaters and other transformer applications - will draw a current which is said to lag behind the voltage, thus producing a 'lagging' power factor.

On the other hand, capacitors, contained in most power factor correction equipment, draw current that is said to lead the voltage, thus producing a 'leading' power factor.

If capacitors are connected to a circuit that operates at a nominally lagging power factor, the extent that the circuit lags is reduced proportionately to the amount the capacitor's lead.

Circuits having no resultant leading or lagging component are said to operate at a unity power factor - where the total energy consumed is equal to the useful energy.

So much for the basic physics lesson, there is more to consider.

Reactive Energy: Use of System Charges

Most commercial electricity users will by now have been notified by their regional electricity company (REC) that they will in future be subjected to an additional charge for reactive energy.

This reactive charge has been incorporated within electricity tariffs and agreements for many years, but has been dormant.

It is part of the 'use of system' charge and is therefore not dependent upon the energy supplier.

Charges for reactive energy exist in two thirds of the REC areas.

Reactive energy is effectively the power used to energize the magnetic fields in motors, inductive heaters and so on.

While the useful energy is measured in kilowatts (kW), the reactive part is measured in kilovoltampsreactive (kVAr).

Power Factor Correction Equipment: Cost Savings

It is the aim when specifying and installing power factor correction equipment to reduce the reactive energy being drawn from the system.

Reactive energy substantially increases the energy losses on the local and national supply networks, including your customer's own installation.

This increased loss also applies to the customer's own transformers if they are a high voltage user.

Reactive energy also has the undesirable effect of reducing the output capacity of the network and transformers.

One thing to look out for in installations is that even where the user has power factor correction equipment installed, it might not be functioning adequately.

Remember the relationship between leading and lagging power factors.

If the capacitors are not functioning, the load has increased on the system, or indeed, if the original power factor calculations were incorrect, there could still be significant energy savings to be achieved.