Understanding Power Factor and Why It's Important Power factor is a measure of how effectively you are using electricity. Various types of power are at work to provide us with electrical energy. Here is what each one is doing. Working Power – the “true” or “real” power used in all electrical appliances to perform the work of heating, lighting, motion, etc. We express this as kW or kilowatts. Common types of resistive loads are electric heating and lighting. An inductive load, like a motor, compressor or ballast, also requires Reactive Power to generate and sustain a magnetic field in order to operate. We call this non-working power kVAR’s, or kilovolt-amperes-reactive. Every home and business has both resistive and inductive loads. The ratio between these two types of loads becomes important as you add more inductive equipment. Working power and reactive power make up Apparent Power, which is called kVA, kilovolt-amperes. We determine apparent power using the formula, kVA2 = kV*A. Going one step further, Power Factor (PF) is the ratio of working power to apparent power, or the formula PF = kW / kVA. A high PF benefits both the customer and utility, while a low PF indicates poor utilization of electrical power.