Power factor is a measure of how efficiently electrical power is consumed. A system with a poor power factor uses more power than it actually needs, resulting in high energy bills. Power factor monitoring and the introduction of corrective equipment may result in significant savings.

When a system is 100% efficient, power factor is unity. If the power factor is less than unity extra power is needed to do the same work. Power Factor Correction (PFC) equipment returns the power factor to as close to unity as possible thus reducing the burden on the supply.