Power factor penalties in Odisha and what an APFC panel actually saves
There is no longer a separate power factor penalty line on an Odisha HT bill — because there does not need to be one. Under the current OERC tariff, HT and EHT energy charges are billed on kVAh drawal rather than kWh, so a poor power factor is charged automatically inside every unit. LT consumers are still billed on kWh, but pay demand charges per kVA, so it costs them too.
- HT / EHT energyBilled on kVAh — power factor is priced into every unit
- LT energyBilled on kWh, but demand charged per kVA
- At PF 0.801.25 kVAh bought for every 1 kWh of real work
- At PF 0.991.01 kVAh for the same work — about 20% less
How is power factor actually charged in Odisha?
This is the part most plant owners in this district have not caught up with, because it changed quietly and it does not appear on the bill as a line item called "penalty".
The current OERC tariff notification says it plainly: energy charges for all LT consumers continue to be billed on the basis of kWh, whereas energy charges for HT and EHT consumers are billed on the basis of kVAh drawal.
kVAh is apparent energy. kWh is real energy. The ratio between them is your power factor. So if you are an HT industrial consumer running at 0.80, you are already paying about 25 per cent more per unit of useful work than a neighbour running at 0.99 — not as a fine, but as the ordinary price of the units. Nobody has to catch you. The meter does it.
| Power factor | kVAh bought per 1 kWh of work | Extra you pay vs 0.99 |
|---|---|---|
| 0.70 | 1.43 | +41% |
| 0.75 | 1.33 | +32% |
| 0.80 | 1.25 | +24% |
| 0.85 | 1.18 | +17% |
| 0.90 | 1.11 | +10% |
| 0.95 | 1.05 | +4% |
| 0.99 | 1.01 | — |
And if you are on an LT connection?
Your energy is still billed on kWh, so the units themselves are not inflated. But LT industrial supply carries a demand charge levied per kVA of billing demand, and kVA is kW divided by power factor. Run at 0.80 instead of 0.98 and your billed demand is about 22 per cent higher for exactly the same machinery doing exactly the same work.
There is also a load factor rebate worth having: the current tariff allows LT industrial consumers a rebate of 10 paise per unit where the monthly operating load factor exceeds 40 per cent and bills are paid on time. That is a separate lever from power factor, but the two together are usually the cheapest money in a small mill.
How much kVAr does the plant need?
The formula is short:
kVAr = kW × (tan φ₁ − tan φ₂)
where φ₁ is the angle of your present power factor and φ₂ the angle of your target. Worked through for the common case of a 100 kW load going from 0.80 to 0.98: tan(cos⁻¹0.80) is 0.750, tan(cos⁻¹0.98) is 0.203, so you need 100 × (0.750 − 0.203) ≈ 55 kVAr.
As a rough planning figure for a mixed motor load, budget somewhere between 0.4 and 0.6 kVAr per kW of connected load to get from the low eighties to the high nineties. Do not buy on that figure — buy on your own bill — but it will tell you whether you are shopping for a 25 kVAr panel or a 150 kVAr one.
Fixed capacitors or an APFC panel?
Fixed capacitors are cheap and they work, on one condition: the load must be roughly constant. Bolt a fixed bank across the bus of a mill that runs flat out twelve hours a day and idles the other twelve, and for half the day you are overcorrected.
Overcorrection is not harmless. A leading power factor raises the voltage at the bus, stresses winding insulation, can cause resonance with drive harmonics, and — because the meter records apparent energy without caring which way the reactive component points — is billed on a kVAh meter exactly like lagging. You paid for capacitors that are now costing you money.
An APFC panel measures the power factor continuously and switches capacitor steps in and out through contactors to track it. On a mill with a mix of hullers, blowers, elevators and a compressor — loads that come and go all day — that is the only arrangement that holds a good power factor across the whole shift.
The most common thing we are shown is a capacitor bank that was correctly sized eight years ago, before the mill added a second line and two VFDs. It is now both undersized at full load and overcorrecting at night, and the owner has concluded that capacitors do not work.
The second is capacitor duty contactors that were replaced with ordinary AC-3 contactors during a breakdown, because that was what was on the shelf. A capacitor switching contactor has damping resistors on leading contacts to handle the inrush; an ordinary one welds. If your steps have stopped switching, look there before you condemn the controller.
Also worth knowing: once you put drives on a line, add detuned reactors to the capacitor steps. Harmonics from VFDs and plain capacitors together can resonate, and the first sign is capacitors that keep failing early.
Working out your own payback
Take a recent bill and find three numbers: kWh, kVAh and the energy charge rate.
- Present power factor = kWh ÷ kVAh.
- Target kVAh = kWh ÷ 0.99.
- kVAh saved per month = present kVAh − target kVAh.
- Monthly saving = kVAh saved × your energy charge rate.
- Payback in months = installed cost of the APFC panel ÷ monthly saving.
For an HT industrial consumer with a genuinely poor starting power factor, that arithmetic commonly lands inside a year and sometimes inside six months. It is one of the few plant investments where the number is not a projection — it is on last month's bill already.
The short version
- HT and EHT in Odisha are billed on kVAh. Power factor is not fined, it is priced in.
- LT is billed on kWh but demand-charged per kVA, so it still costs you.
- Size the bank from your own bill: kVAr = kW × (tan φ₁ − tan φ₂).
- Constant load, fixed capacitors. Variable load, APFC.
- Drives on the line? Specify detuned reactors and capacitor duty contactors.
Send us a photograph of a recent bill showing kWh and kVAh along with your connected load, and we will work out the kVAr, tell you whether fixed or automatic is right, and quote the panel.
Tariff figures above are from the current OERC tariff notification for the Odisha distribution licensees. Rates and rebates are revised periodically — check the figures against your own bill and the current notification before committing to a purchase.