Analytical notes on the economics of power-factor correction

The paper deals purely with the economic aspect of powerfactor correction in transmission systems; it is not intended to bear on the subjects of voltage regulation or stability, nor is it concerned with the problem of power-factor improvement in electrical machinery. In brief, the losses in a transmission line supplying power to a load having a power factor less than unity can be reduced by power-factor correction at the receiving end, the most economical system being that in which the annual saving in the transmission-line losses due to power-factor correction shows the greatest margin over the total annual cost of the plant installed to provide that correction. The author arrives at general expressions which give for any particular case, on inserting relevant practical figures for various constants and basic costs, the most economical degree of power-factor correction and hence the best rating of synchronous or other condenser equipment.