POWER
FACTOR
UNDERSTANDING POWER FACTOR BILLING
Beginning October 2011, commercial customers will have their demand charge
adjusted based on their power factor if they are below .85. Here are some common
questions and answers that will help you understand power factor adjustments.
WHAT IS POWER FACTOR?
Power Factor is the ratio of real power or energy (kilowatts or kW) to apparent or total power
(kilovolt-amperes or kva) used by customers. It measures how effective total power is used. A
high power factor means electrical power is used effectively, while a low power factor signals
electrical power is used poorly.
WHAT CAUSES A LOW POWER FACTOR?
The main contributors to low power factor are motors operated at less than full load. This often
occurs in facilities that have induction motors, compressors, conveyors, magnetic ballasted
fluorescent lighting and various types of manufacturing equipment. Step-down, step-up
transformers can also cause a low power factor.
WHAT IS A POWER FACTOR CHARGE?
The power factor charge is an adjustment to the demand charge if the customer’s power factor
is less than 0.85 or 85%. Power factor adjusted demand is calculated using this formula:
Billing Demand=Peak Demand (kW) × .85 ÷ by metered power factor
Here are two examples with different sized loads. Both have a power factor of .75.
500 KW ( .85 ÷.75 ) = 566.67 kW
50 KW ( .85 ÷.75 ) = 56.67 kW
566.67 KW × $14.03 (summer demand rate) = $7,950.33
56.67 KW × $14.03 (summer demand rate) = $795.03
WHO CHARGES FOR POWER FACTOR?
It is standard practice for Texas utilities such as Centerpoint (Houston), Oncor (DFW area) and
El Paso to charge for power factor adjustments. In October, 2011, all customers with a power
factor of 0.85 and lower will see an adjustment charge on their bill.
HOW CAN I INCREASE MY POWER FACTOR?
Consider the following options to help increase your power factor:
n Resize electric motors n Add variable frequency drives
n Install power factor correction capacitors n Resize step-up, step-down transformers
n Replace older magnetic ballasts to electronic
Austin Energy offers lighting retrofit, motor and variable frequency drive rebates that increase energy efficiency
and help increase your power factor. Refer to our website at www.austinenergy.com/go/powerFactor for details
and for a list of vendors who can help you assess and possibly install power factor correction capacitors.
Use this chart to view monthly power factor charges.
AUSTIN ENERGY’S MONTHLY POWER FACTOR CHARGES*
PF70%71% 72% 73%74% 75% 76%77% 78% 79%80% 81%82% 83%
84%
Demand
50 KW $143
$132
$120$110$99 $89$79$69$60$51$42$33$24 $16 $8 100 286263241219198 178158139120101 83 66 49 32 16
200 572526482439397 356316277239203167132 98 64 32
300 858789723658595 534474416359304250198146 96 48
4001143
1052963877793 711632554479405334264195 129 64
5001429
1315
12041096991 889790693599507417329244 161 79
6001715
1578
14451316
11901067948832718608500395293 193 95
7002001
1841
16861535
138812451106970838709584461342 225111
8002287
2104
19271754
1586142312641109958811667527390 257127
90025732367216819741785 1601142212471077 912 750 593 439 289 143
1000 28592630240921931983 17791580138611971013 834 659 488 321 159
1200 34303157289026312380 213418961663143712161001 791 586 386 191
1400 40023683337230702776 249022121940167614181167 922 683 450 222
1600 45744209385435093173 2846252822181915162113341054 781 514 254
1800 51454735433639473569 3202284424952155182415011186 878 579 286
2000 57175261481743863966 3557315927722394202616681318 976 643 318
2200 62895787529948244363 39133475304926342229183414491074 707 349
2400 68616313578152634759 42693791332628732432200115811171 771 381
2600 74326839626257015156 46254107360431132634216817131269 836 413
2800 80047365674461405552 49804423388133522837233518451367 900 445
3000 85767891722665795949 53364739415835923039250119761464 964 476
*The calculations above are based on the average of winter and summer peak demand charges.
FOR MORE INFORMATION ON POWER FACTOR,VISIT
WWW.AUSTINENERGY.COM/GO/POWERFACTOR