Power Factor Correction
Power factor It is a measure of how efficiently electricity is being converted into useful work output. It is measured as the ratio between the kW and the kVA drawn by an electrical load where the kW is the actual load power and the kVA is the apparent load power. Power factor typically ranges between 0.5 and 0.99.
Power factor is important for many commercial customers on demand tariff billing structures as a lower power factor results in higher electricity bills. If your bill includes a ‘$/kVA’ tariff, then you are paying for power factor.
Power factor correction (PFC) involves installing capacitors and control equipment at the site to improve power factor and hence reduce electricity costs. Commonly, PFC equipment can pay for itself in under 12 months.
PFC solutions can be supported in two ways:
- an ideal leased solution because the payback for the technology far exceeds any lease repayments, meaning cash in the hand straight away; or
- with Energy Savings Certificates in NSW, which can be attractive for larger installations in certain circumstances.
Demand Manager is accredited to create ESCs for PFC installations.