Can improving Power Factor help your Energy Bill?

***Update - 4/21/09: An Electrical Engineer friend of mine just send me the most detailed technical and economic analysis I've seen on the topic of residential power factor correction devices.  Check it out after you read the blog below if you are really interested:  NLCPR: Power Factor correction

Part of our goal with the Mapawatt Blog is to review the best products that can save energy and water in your home.  Product developers know that as energy costs rise, consumer's budgets get tightened, and people start to care more about their environment (the trifecta of sustainable drivers), those consumers are going to want products that help them save energy.  But do all these products live up to their claims?

One of these products is a power factor correction device and can be seen here.  This product claims:

Residential customers throughout North America could see a realized savings of 8% - 10% typically and as much as 25% on their electrical usage (and thus power bills).

However, I'm not buying it.  There are two great resources on-line that address this same issue.  One is from the National Institute of Standards and the other is a blogger I've been reading for 4 years and has a great section on electricity, Michael Bluejay. Both of these resources say power factor correction really wont help on your residential bill.  It can make a difference for certain industrial users who may be billed by the Utility for peak demand, but this is another story (and it is addressed in the Bluejay article).

To go a little deeper, the formula for Power Factor (PF) is below:

PF = Real Power (Watts) ÷ Apparent Power (VA)

- or -

Watts = PF*Amps*Voltage = PF * Apparent Power

The power factor correction devices are said to improve the second half of the above equation, the Apparent Power.  However you don't pay your utility for Apparent Power.  You pay them for Real Power (Watts).  Apparent Power is defined as the total power in an AC circuit, both dissipated AND returned! (scroll to the bottom of this link to view the power triangle and description of Apparent, Real and Reactive power).  This means that if you currently have a poor power factor, your  Apparent Power is higher, but all this means is that you are returning more unused electrons to the utility!  But since they only charge you for used electrons (dissipated electrons = Real Power = Watts) you don't give a hoot about your Apparent Power!

Let's take an example of 2 completely identical motors sitting side by side.  Both of these motors have the exact same efficiency and operate at 1.2 kW. The first motor doesn't have a power correcting device.  The second motors does have PF correcting device.

  • Motor 1: 1.2 kW motor, connected to a 120 V circuit, PF = .7
  • Motor 2: 1.2 kW motor, connected to a 120 V circuit, PF = .999 (this has the Power Factor correction device, thus the excellent PF!)

Using the equation above we can show the amps (current) that will be dissipated in motor 1:

1.2 kW = .7 *120V * A → A= 14.29

And we can do the same thing for motor 2:

1.2 kW = .999*120V*A → A=10.01

But this doesn't mean you'll pay less to the utility!  All this shows as that your power factor increases (gets better) your amperage decreases, but the Real Power (Watts =  what the utility charges you) stays the same!  Therefore no matter your power factor, in residential settings the utility is still going to show that you took the same amount of Real Power off of the power lines, so that is what you pay.

I would like to see more info from the manufacturers of these devices on how improving PF helps save you Watts!  Basically, your utility doesn't really care what your Power Factor is, so I want to see some evidence on how this device impacts your energy bill.

One more thing!  On the product's website there are many customer testimonials.  NEVER believe customer testimonials.  Especially on things like energy saving devices or products that claim they can improve your gas mileage.  The reason people believe these testimonials is because they can't see electricity flowing through their home, so they just take the product's statements at face value.  Even if the "customer" really said the things about the product, how do you know they aren't mentally insane and or compulsive liars?

Also, if your energy bill goes down the month after you install this, how do you know its not just because you didnt have your AC or lights on as much?  You dont! Only believe data and analysis from trusted web sources (Mapawatt, Rocky Mountain Institute, Energy Star, Michael Bluejay, etc.).

I'm not saying this doesn't work, but I am saying that I need more evidence, and until I see more evidence, I think your and my money can be spent on better energy savings

I'm not the only site questioning the validity of Power Factor correction devices.  Open4Energy has a great review of Power Factor correction devices and another post on Energy Saving Scams.  I should note that it is in their "scam" section!

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I once saw a KVAR being demonstrated. He had a 1/4hp split phase motor, an actual electric meter, and the KVAR unit. Also was a switch that run the motor either with or without the KVAR. It was obvious that the meter ran slower with the KVAR switched in. All wires were out in the open to see. You said the meter doesn't care about PF. Has this been verified in reality? Ralph above said the meter ran slower, and that's what it's all about, not theroy. Granted the potential savings is small.
I am considering selling energy box. I have very no/very little background in electricity. The consensus I get as I do research is that most people do not think the energy box works in residential homes. My question is this: Lets instead of focusing on a box that is designed to save 10% to 25% on your monthly electricity bill, we have decided to engineer or design scenarios that would cause monthly increase in monthly electricity bill resulting in a increase in bill. Can this be done?,or is electricity just something that is available with no way of improving or decreasing the efficency, the cost of the electricity? Thank you in advance for you answer.
I have a little twist on the residential use of a PFC. I have three phase power and it saves me plenty. I also added one in my machine shop,which includes wire EDMs, ,sinker edms, cnc mills etc,..And I enjoy a great savings. The numbers speak for themselves for more than a year. Thank You
But since you have 3 phase power do you get billed differently than a normal residential house?
Hey, Ralph sounds like someone is brainwashing you about the legality of installing power factoring equipment.I agree residential systems might not see much of a savings. I test and install PF equipment in the industrial environment. It works! By the way what makes a meter spin or count kWhrs. I think its more than just PF and voltage. Current has to flow. Which spins the meter faster a load of 14 amps or a load of 10 amps ( eariler example)
I distribute these <a href="" rel="nofollow">power factor correction devices</a>. We guarantee they will lower your bill 10%. We know everyones bill will not drop 10%, but we also know that most peoples bill will. In our mind it was worth the risk to help boost the consumer confidence. If you are pondering these devices check our site out, order one, if you dont save 10% I personally will refund your money. All of our guarantees are in writing with real signatures and are included with every unit we ship. They can be printed off of our site as well. We look forward to the opportunity to show you what these devices can do. FYI I have also sent Michael Bluejay an email offering the same for him, hopefully he will give it a shot.
Chandler, I approved your comment but I dont believe in your product; nor would I ever recommend that people should buy it. Can you please explain to Mapawatt readers how, in technical terms, your products saves them money on their energy bill even though the utility doesn't penalize for a bad power factor? Also, how can people actually prove that the bill drops 10% considering temperature fluctuations month-month would make that impossible to show?
You don't have to ask for any more evidences. Compensating reactive power at the load won't lower your bill, as they explain on <a href="" rel="nofollow">SmartGridElectronics</a>.
There seems to be so much confusion about the use of power factor correction capacitors and savings for the residential customer. As a graduate electrical engineer, I practiced my profession for over 40 years, many of which involved the use and billing of electrical energy. I was a registered professional engineer in the states of Oklahoma and Texas. The use of power factor correction in the home, the savings will be miniscule, once you take the savings with a reduction of the I squared R losses in the house wiring less the capacitor losses(yes they ALL have losses). In measuring the power consumed by an electric motor with and without power factor correction, I was able to detect zero difference. I performed this and documented the results in order to dispell the claims made to me in about the year of 1995. Now, when it comes to some commercial and all industrial users, there are some great potentials for savings by correcting the power factor because the commercial and industrial electric rates are structured to penalize the customer for low power factor. Some power companies base their demand charge on KVA rather than KW with a penalty for power factor below some cutoff number. I have analyzed hundreds of electric rates all across the US.
Hello Dan, Your work implies you may have a list of the States that require Electric Utilities to charge Industrial and Commercial customers for poor power factor: 3/27/2010 "...the commercial and industrial electric rates are structured to penalize the customer for low power factor. Some power companies base their demand charge on KVA rather than KW with a penalty for power factor below some cutoff number. I have analyzed hundreds of electric rates all across the US." What States/Electric Utilities do this?


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