Maintaining a high power factor in a plant can yield direct savings. Some, such as reduced power bills and release of system capacity, are quite obvious; others, such as improved voltage and decreased I2R losses, are less obvious but nonetheless real, as are many indirect savings as a result of more efficient performance. 

The cost of improving the power factor in existing plants and of maintaining proper levels as load is added depends on the power-factor value selected and the equipment chosen to supply the compensating reactive power.

Adding capacitors generally is the most economical way to improve the plant power factor, especially in existing plants. Capacitors have several beneficial features, including relatively low cost, ease of installation, minimal maintenance requirements, very low losses, plus the fact that they are manufactured in a variety of sizes. Individual units also can be combined into suitable banks to obtain a large range of ratings. Thus, capacitors can be added in small or large units to meet existing operating requirements with additional units added only when necessary to meet increased future requirements.