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AGL Electroserv FAQs

About Power Factor Correction

  • Q What is Power Factor and how does PFC Equipment work?

  • The Power Factor of an electrical installation is the ratio between the power that is actually used (kW) and the power that is supplied  (KVA).  It is a measure of how efficiently an installation uses Electrical Energy. 

    Power factor equipment supplies the reactive current (eg. magnetising current required by electric motors to turn but does no real work) required by an installation that is normally supplied from the supply transformer and therefore passes through the electricity meters. Reducing this magnetising current through the electricity meters and the switchboard will reduce the cost if the tariff is based on KVA Demand (or apparent power).  The power actually used is the ‘real ‘ Power (in watts).  The power supplied is the “apparent” power (in Volt Amps) .


                               Power Factor =    Real Power (kW)/Apparent Power(KVA)  


  • Q How big is PFC equipment and where does it go?

  • Power Factor Correction  Equipment is placed within, or near, the main electrical switchboard.  The equipment is connected into this switchboard and connected to a convenient point below the electricity suppliers metering equipment (i.e. Current transformers).  A new switch may be required in some cases.  

    Depending on the rating of the equipment (in”kVAr” or Kilo Volt Amps Reactive) the typical size is he same as a standard fridge.


  • Q How much will it save?

  • This depends on the following:


    • The Tariff Type.  For PFC to reduce Energy Costs you must be on a “KVA” Demand Tariff 

    • Maximum demand (in KVA) as shown on your electricity Bill  

    • The initial power factor at this maximum demand.

    • The target power factor (usually 0.98 for best economy)

    • The “demand profile” eg. KVA demand over a, say, 12 month period and the power factor over this same period.

    As an example: Average Maximum Demand = 200KVA @ 0.8pf improving PF to 0.98


    o Cost per KVA/month (as shown on Bill)         = $10:50

    o Cost /mth without pf = $ 2,100

    o New Avg KVA @ 0.98pf = 163KVA

    o New Cost/Month = $1,712

    o Savings/year(ave) = $ 4662

    o Simple Payback (yrs) = 1.5 Years*

    * based and an estimated installed cost of a 100kVAr PFC at approx. $7,000 



  • Q When do I see the benefits?

  • Benefits – Electricity meters usually reset at midnight on the last day of each month. Because the electricity bill is based on a “Maximum Demand” for the month, benefits from reducing this demand will commence the month following the commissioning and setting to work of the equipment.  Some Electricity suppliers require a form to be submitted so they can reduce the “contract demand” portion of the Bill.

Servicing and Installation

  • Q What is the warranty period, PFC equipment life expectancy?

  • Standard warranty is three (3) years from date of commissioning.  Life expectancy, based on estimates from individual component manufacturers is >100,000hrs (About 11 years).

  • Q What interruption will I experience for installation of PFC Equipment?

  • Installation may require that the power to the installation be switched off.  Allowance is made for this to be done in “out of hours” times to suit the end user. (Please note – the supply authority cost for disconnection of power, if applicable, are not normally included).  The expected time can range between 1 – 4 hours.

  • Q What are the service requirements?

  • Service of the PFC Equipment is recommended on yearly basis.  This includes checking all connections, internal temperatures, cleaning internal and external and checking operation and currents.  A report is generated and includes recommendations for expansion and/or remedies if required.  A visual check by the end user is recommended on a monthly basis

  • Q What do I do if there is a problem with the PFC Equipment?

  • Switch off - All Power Factor Correction equipment is supplied with a switch for isolation.  This switch will be clearly marked and can be operated any time without interruption to other parts of the installation.  The digital indicator gives many details about the condition of the equipment and also gives data about the main switchboard it is connected to. Service contact details are contained in the instruction manual or on the equipment.

  • Q Why should I buy my Power Factor Correction Equipment from AGL Electroserv?

  • AGL Electroserv is a Quality Endorsed Company and we go through a rigorous process to select PFC Equipment that will operate safely and reliability in Australian conditions. PFC Equipment purchased from AGL Electroserv will be of the highest quality and reliability , many years of experience and knowledge ensure equipment operates as specified.  

    To back this up we offer an industry leading three (3) year warranty on product produced and extend this to five (5) years if PFC Equipment is serviced annually by AGL Electroserv Pty Ltd.


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