Power Factor Adjustment
As part of the rate restructuring approved in June 2012 by the Austin City Council, Austin Energy increased the Power Factor Adjustment requirement from 85 percent to 90 percent.
Power Factor is a measure of how efficiently a customer’s operations use electricity.
Customers with low Power Factors draw more electric current than would be necessary with more efficient facilities or equipment. A larger draw from available electricity results in higher system line losses and requires the utility to install additional capacity. Therefore, customers with a low Power Factor have a higher cost to serve.
Effective with October 2012 utility bills, customers with less than a 90 percent Power Factor will see an adjustment to the demand kW on which they are billed.
In other words, when the Power Factor is less than 90 percent during the interval of greatest monthly use, billed kW will be determined by multiplying kilowatt demand during this interval by 90 percent and then dividing that total by the recorded Power Factor during this interval.
The kilowatt demand during the interval of greatest use = 13.5 kW
The power factor during the interval of greatest monthly use = 86.7%
Billed kW = 13.5 kW x 0.90 power factor / 0.867 Power Factor = 14.0 kW