Why Is Reactive Power on My Electricity Bill?
If you've noticed a charge for "reactive power," "kVArh" or "low power factor" on your business electricity bill, you're not alone — and it's avoidable.
Most UK electricity suppliers and Distribution Network Operators (DNOs) charge sites that operate with a power factor below 0.95. This charge typically appears as pence per kVArh (kilovolt-ampere-reactive hour) or simply reactive power charges, and can add hundreds or thousands of pounds a year to your costs — particularly for sites running motors, compressors, pumps, welding equipment or HVAC plant.
What Causes Reactive Power Charges?
Inductive equipment — motors, transformers, fluorescent and discharge lighting, welding sets — needs reactive power to create the magnetic fields they rely on to operate. This reactive power doesn't do useful work, but it still has to flow through the network, increasing losses and forcing the network operator to size cables, transformers and generation capacity larger than they otherwise would need to be, due to the increased current flow.
Because this places extra demand on the network, suppliers pass the cost on to sites with a poor power factor.
How Much Could This Be Costing You?
The exact rate varies by supplier and DNO region, but reactive power charges commonly range from around 0.1p to 0.3p per kVArh at present. For a site running constant motor or compressor loads, that can mean a noticeable line item every month — money that, unlike your real energy usage, buys nothing for your business.
The only way to know your exact figure is to check your bill for a reactive power or "kVArh" line, or have us review it for you as part of a free bill check.
How Power Factor Correction Removes the Charge
Installing correctly sized capacitor banks (or, where harmonics are present, detuned or active filtering equipment) offsets the reactive power drawn by your inductive loads, bringing your power factor back above the penalty threshold. In most cases, this removes the reactive power charge from your bill entirely.
Next Steps
If you'd like to know whether you're paying reactive power charges and what correcting your power factor could save, get in touch for a free bill check. We'll review your bill at no cost, and if a full site survey would help confirm the savings, we'll explain the cost before booking one in.
Request a Free Bill Check