Power Factor and kVA Electricity Tariffs

The relationship between current and power in an AC circuit is expressed by the equation
 

or The power factor is a number between 0 and 1. The power factor is the cosine of the phase angle between the voltage and the current. For a given power consumption, the current drawn is higher than necessary if the power factor is less than 1.

The power factor can affect the cost of electricity. This is usually only for larger commercial and industrial electricity users. Larger users usually have a bill with 3 components, energy charges, network charges and regulator charges. Power factor only affects the maximum demand component of the network charges. Generally, kVA demand tariffs are structured to be revenue neutral compared with kW demand tariffs at a power factor of 0.8
 

inquiries melb@aie.org.au
 
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