Power Factor Surcharge

Power factor surcharge is imposed when your power factor is less than 0.95
(electricity supply above 132 kV) or less than 0.85 (electricity supply below
132 kV).

What is Power Factor

Power Factor is an index used to compute the efficiency level of electricity

usage. The index is measured from 0 to 1. A higher index shows efficient
usage of electricity and vice versa. Low power factor shortens the lifespan of
electrical appliances and causes power system losses to TNB.

To understand power factor, we will start with the definition of some basic
terms:-

KW Working Power (also called Actual Power, Active Power or

Real Power).

It is the power that powers equipment and performs useful

work.
KVAR Reactive Power.

It is the power which magnetic equipment such as

transformers, motors and relays need to produce the
magnetizing flux.
KVA Apparent Power.

It is the vectorial summation of KVAR and KW.

Let’s look at a simple analogy in order to better understand these terms.

Let’s say you are at a park and it is a hot day. You order a glass of a
carbonated drink. The thirst-quenching portion of the drink is represented by
KW.

Unfortunately, along with your drink comes a little bit of foam. The foam
does not quench your thirst. This foam is represented by KVAR.

The total content of your glass, KVA, is this summation of KW (the

carbonated drink) and KVAR (the foam).
 Power Factor is the ratio of Working Power to Apparent Power.

Power Factor = KW / KVA

Looking at our carbonated drink analogy, power factor is the ratio of

carbonated drink (KW) to the carbonated drink plus foam (KVA).

Power Factor = KW / (KW + KVAR)

= Carbonated drink / (Carbonated drink + foam)

Thus, for a given KVA:-

i. The more foam you have, the lower your power factor.

ii. The less foam you have, the higher your power factor.

For efficient usage of electricity, power factor must approach 1.0. Power
factor that is less than 0.85 shows inefficient use of electricity.

Calculation for Power Factor = KW

√(KW2 + KVAR2)

Causes of Low Power Factor

In our carbonated drink analogy, low power factor resulted when the foam is
large. Low power factor is caused by inductive loads, which are sources of
reactive power.

Examples of inductive loads are:-

• Transformers
• Induction motors
• High Intensity Discharge (HID) lighting

Inductive loads constitute a major portion of power consumed by commercial

and industrial sectors.
How to Improve Your Power Factor

Customers are advised to follow these steps:-

• Install capacitors (KVAR Generators)

o Capacitor
o Corrector
o Synchronous generators
o Synchronous motors
• Minimise operations of idling or lightly loaded motors.
• Avoid operating equipment above its rated voltage.
• Replace standard motors as they burn out with energy efficient
motors.

Benefits of Improving Power Factor

Benefit 1: Reducing KW billing demand

Low Power Factor requires high reactive power (KVAR) and apparent power
(KVA), which is the power that TNB supplies. Therefore, a facility’s low
power factor forces TNB to increase its generation and transmission capacity
in order to handle this extra demand.

By increasing power factor, customers use less KVAR. This results in less
KW, which equates to RM savings for TNB.

Benefit 2: Eliminating power factor surcharge

Utility companies all around the world charge customers an additional

surcharge when their power factor is less than 0.95. In fact, some utilities
are not obliged to deliver electricity to their customers at any time the
customer’s power factor falls below 0.85.

Thus, customer can avoid this additional surcharge by increasing power

factor. In Malaysia, TNB is allowed through the Malaysian Grid Code and the
Malaysian Electricity Distribution Code, to impose a surcharge to the
customer if the power factor is <0.85 for customers receiving less than
132kV .

Benefit 3: Increased system capacity and reduced system losses in

your electrical system

Low power factor causes power system losses in the customer’s electrical
system. By improving power factor, these losses can be reduced. With the
current rise in the cost of energy, increased facility efficiency is important.
Moreover, with lower system losses, customers are able to add additional
load in their electrical system.

Benefit 4: Increased voltage level in your electrical system, resulting

in more efficient motors

As mentioned before, low power factor causes power system losses in

customer’s electrical system. As power losses increase, customer may
experience a voltage drop. Excessive voltage drops can cause overheating
and premature failure of motors and other inductive equipment.

Therefore, by raising the power factor, customers can minimize these voltage
drops along feeder cables and avoid related problems. Motors will run more
efficiently, with a slight increase in capacity and starting torque.