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In power transmission and distribution, alternating current power is distinguished into three different types: real power (P), measured in watts (W); apparent power (S), measured in volt-amperes (VA); and reactive power (Q), measured in volt-amperes reactive (VAr).

The power factor is defined as the ratio:

${\displaystyle {\frac {P}{S}}}$.

In the case of a perfectly sinusoidal waveform, P, Q and S can be expressed as vectors that form a vector triangle such that:

${\displaystyle S^{2}=P^{2}+Q^{2}}$

If φ is the phase angle between the current and voltage, then the power factor is then equal to ${\displaystyle \left|\cos \phi \right|}$, and:

${\displaystyle S=P\left|\cos \phi \right|}$

By definition, the power factor is a dimensionless number between 0 and 1. Power engineers are often interested in the power factor as this determines how efficient a power system is.

The power factor is determined by the type of loads connected to the power system. These can be

• Resistive
• Inductive
• Capacitive

If a purely resistive load is connected to a power supply, the power factor will be unity (1) and only real power will flow. Inductive loads such as transformers and motors (any type of wound coil) absorb reactive power. Capacitive loads such as capacitor banks or buried cable generate reactive power.

A power transmission system is working at its greatest efficiency when the power factor is at unity (i.e. when no reactive power is present, so that the real power is the same as the apparent power). When the power factor is less than unity, the transmission losses increase and the system capacity is reduced. Power companies therefore require customers, especially those with large loads, to maintain, within specified limits, the power factors of their respective loads or be subject to additional charges.

When the load is purely resistive, the power delivered to it is equal to the product of volts and amperes, so the power factor is unity. When the current lags the applied voltage (due to an inductive load) the power factor is said to be lagging. When the current leads the applied voltage (due to a capacitive load) the power factor is said to be leading.

Note that although the value of the power factor reveals the magnitude of the phase angle, it does not reveal whether it is positive or negative. Thus, the power factor is specified as leading or lagging.

For example, to get a 1 kVA of apparent power if the power factor is unity, 1 kW of power needs to be generated (1 kVA = 1 kW × 1). At low values of power factor, more power needs to be generated to get the same apparent power. To get 1 kVA of apparent power at 0.2 power factor 5 kW of power needs to be generated (1 kVA = 5 kW × 0.2).

It is often possible to adjust the power factor of a system to very near unity. This practice is known as power factor correction and is achieved by switching in or out banks of inductors or capacitors.

• Electronics
• Electric power