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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Great comment Peter and your site is extremely informative. I agree with you on just about all accounts. I would add one more tip to save money and cut energy costs: get control of your heating and cooling by: actively using a programmable thermostat, rely on ceiling fans when possible, open windows in spring, etc. Basically, do the little things that add up on the biggest energy consumer (heating/cooling) in your household. It just takes a conscious effort. We have to be on the lookout for these gimmicks and inform the public before they get suckered in!
The only situation I have encountered where power factor correction to the home made sense is this: a geothermal heat pump (the compressor has a low power factor) is powered by an AC inverter (battery bank, wind generator or solar) and requires a very large and expensive inverter. Correcting the power factor from .60 to 1 results in a 40% reduction in the size (VA rating) of the inverter needed. Power consumption has not changed. However, a less expensive power inverter can be chosen, perhaps saving enough cash to pay for the power factor correction unit. Aside from very specialized situation like this, the savings from these units is not small. It is zero. Remember that the only savings are from heating losses in the copper wires -- not in reductions from power bills. These heating losses are very small. I am delighted to see intelligent web sites like this. There is an extreme shortage of decent consumer educational material. Commercial sites are worried about offending advertisers or attracting law suits and are likely to soften their statements and say "we didn't see any savings but you can try for yourself, or your savings will probably be a few pennies" rather than "This product cannot save you money any more than your car can run on water. If it did, the fundamental laws of physics need to be re-written. Things like 1+1=2 or and water cannot burn". Currently, the only practical ways for most consumers to save money and cut energy costs revolve around using less. The largest for most consumers are in this order: Use the cheapest energy source (natural gas), use less hot water (low flow shower heads). After this, it gets more difficult - add insulation, lower the heat settings, get newer energy saving appliances. The biggest users are heat and hot water. Solar PV and heat would be great if the equipment wasn't so expensive. It is a complex mess -- go to if you want a good e-book to ponder. I wish there were simple solutions but our current society is based on cheap and limitless energy and zero thought has been put into realistic notions of sustainability leaving us stuck with impractical housing, commuting communities and other absurdities. Regards, Peter Parsons
Thanks for blogging about power factor devices. I got email from a reader who installed one and insists that a specific before/after test (clocking his electric meter) shows a savings with the device active. With all the interest in these devices and the conflicting accounts, I think I need to test one myself. So this summer when I have some time I'm going to buy one of these things, install it, test it, and report the results. If it somehow it turns out they actually work I'll recommend that people buy them.
Michael, I spoke with an engineer I work with today and he said he has a friend who is an electrical engineer who has one of these devices installed but doesnt really know if it works or not. I'm going to see if I can go run some tests on his house. There is a lot of mystery behind these products! Thanks for the comment. You have an excellent website!
According to a utility I spoke to recently, it is correct that they only bill larger customers for VA and households for watts. So improving power factor at home will do little for the electric bill but cause less harmonics (which is good for other reasons) and make utilities lose less. However, as utilities are well aware of the usually poor power factor of non-heating home electronics (such as computers, TVs and CFLs), they do include a nominal extra fee into the energy price to compensate for these losses. Everyone pays, whether they have poor power factor electronics or not, and I very much doubt utilities will lower this hidden fee for an individual household if it gets a power factor correction device or only uses products that have PF 1 (such as icnandescent lamps, toasters, heaters and stoves). Thus I have to agree that this sounds like a rip-off to claim it will lower the energy bill.
Very good point Chris. There is a huge need for educting customers to look for evidence and do some research before jumping on "hot" promisses and spending money! BTW do you know ? Sounds like they have something to offer to eligible customers.
Thanks Galit. I think you meant It looks like this organization is an awesome non-profit!


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