Power factor is the relationship between working (active) power and total power consumed (apparent power). Essentially, power factor is a measurement of how effectively electrical power is being used. The higher the power factor, the more effectively electrical power is being used.
A distribution system's operating power is composed of two parts: Active (working) power and reactive (non-working magnetizing) power. The ACTIVE power performs the useful work - the REACTIVE power does not. It's only function is to develop magnetic fields required by inductive devices.

• Reduction In kvar Demand
• Decreased electrical equipment cost
• Decreased energy charges
• Decreased Power losses
• No penalties
• Incentive in electricity bills
• Reduce heat loss of transformers and distribution equipment
• Prolong the life of distribution equipment
• Stabilizes voltage levels
• Increase your system's capacity, etc.

How Power Factor Correction Capacitors Solve the Problem of Low Power Factor.

Low power factor is a problem that can be solved by adding power factor correction capacitors to the plant distribution system. Correction capacitors work as reactive current generators “providing” needed reactive power (kvar) into the power supply. By supplying their own source of reactive power, the industrial user frees the utility from having to supply it, therefore, the total amount of apparent power supplied by the utility will be less.

Power factor correction capacitors reduce the total current drawn from the distribution system and subsequently increase system capacity by raising the power factor level.

Causes Of Low Power Factor

• Most of the A.C. motors are of induction type which have low lagging power factor. These motors work at a power factor is extremely small.
• Arc lamp, electric discharge lamps and industrial heating furnaces operate at low lagging power factor.
• The load on the power system is varying ; being high during morning & evening & low at other times. During low load supply voltage increases also magnitude of current increases. This results in the decrease of power factor.

Disadvantages Of Low Power Factor

The Power Factor plays an important role in A.C. Circuit since power consumed depends upon this factor. P = VL x IL x COS(Ф) (For Single Phase)
IL = P/ VL COS(Ø)
P = 1.73 x VL x IL x COS(Ø) (For Three Phase)
IL = P/ 1.73 x VL x COS(Ø)
It is clear from above that for fixed power & voltage the load current is inversely proportional to the power factor. Lower the power factor, higher the load current & vice-versa.

• The KVA rating of equipment is larger. The electric machinery’s are rated in *kVA. kVA = kW/cos(Ф)
• The conductor size. To transmit or fixed amount of power at constant voltage, the conductor will have to more current at low power factor.
• Larger copper losses. The large current at low power factor causes more (I²R) losses in all element of the supply.
• Poor voltage regulation.
• Reduce hunting capacity of system.

The above discussion indicates that the low power factor is an objective feature in the supply system.

The Principle Of Power Factor Compensation
While the ideal Power Factor (PF) is Unity or 1, most Industrial loads have a PF lower than 1. Moreover, this lower PF is usually Inductive, arising out of the windings of Transformers, Motors, etc. These loads consume KVARs (the Watt less component) from the supply line.
The principle of PF Compensation is to supply these KVARs via a capacitor located close to the load, reducing the current drawn from the supply line.

The low lagging power factor is mainly due to the fact that most of the power load is inductive in nature & therefore, take lagging current. In order to improve the power factor, some drive taking leading power factor should be a capacitor. The capacitor draws a leading current & partly neutralizes the lagging reactive power of load current. This raises the power factor of the load.
The devices of Power Factor improvement are as below

• Static Capacitor.
• Synchronous condenser.
• Phase advances.

Power factor Correction is achieved now a days by installing power capacitors . Under fixed load conditions it is possible to put power capacitors in the system which will compensate completely for the wattles component and power factor can be improved to its maximum value. This obviously will not be an exact compensation for loads which are varying in value.
Power factor can be controlled manually or by automatic control systems.
In manual control the operator has to go on making adjustment all the time, which is very tricky and human error cannot be ruled out.
In automatic control, power factor control relay keeps on sensing the power factor all the time and gives suitable signals to contactors connected to it to energize required capacitors.

Power capacitors have been used in many & wide ways in industry from last 40-50 years but its continuous use is often limited by apparent lack of practical application information.
The various applications of capacitors are capacitors for power factor improvement, Series Capacitors in power supply system, surge protection capacitors, Voltage divider Capacitors, Energy Storage Capacitors, Motor Start/Run Capacitors, Fluorescent lighting capacitors, harmonic filter capacitors ,water cooled capacitors etc.