Power Factor Calculator

Power factor (cos phi) is the ratio of real to apparent power, and most UK industrial supply contracts levy a reactive demand charge whenever average power factor falls below 0.95. On a 1 MW load running 4,000 hours a year at 0.85, the reactive demand charge typically lands in the low five figures annually, and it sits on the non-commodity portion of the bill where it can drift unnoticed until a contract review surfaces it. The power factor calculation is the screen that flags whether you are quietly paying it.

For an industrial site with significant motor or HVAC load, the same calculation sizes the capacitor bank that closes the gap. Moving a 500 kW load from 0.82 to 0.96 requires roughly 200 kVAR of compensation, which at current market rates is a project with a payback well inside the contract term. Critically, the calculation must use realistic load points (not just full-load nameplate) because power factor is worst at part-load, which is also where most of the operating hours actually accumulate on a typical site.

For a finance director and an energy manager working together, the power factor number is one of the most reliable cost-out levers on the bill because it is recurring, measurable, and the intervention is well understood. The bill before and the bill after, with the capacitor bank energised, is a clean before-and-after comparison your auditor can follow, and the same calculation supports the case at the next contract renewal when supplier proposals start trading non-commodity recovery against unit rates. Owning the working keeps you in the driving seat.