New to industrial auditing and trying to understand power factor penalties. I have a food processing plant with PF averaging 0.82. Their tariff says penalties apply below 0.90, but I don't see any charges on their bills. Am I missing something?
Power Factor Penalties - When Do They Kick In?
Sandra, check if they have power factor correction equipment that might be malfunctioning. Some utilities only apply the penalty if PF drops below the threshold for consecutive months. What utility and what tariff schedule?
It's Ameren Illinois, Schedule LGS. The plant has capacitor banks but they look pretty old. I'll check if they're even working. The bills just show the PF measurement but no penalty calculation.
Ameren sometimes bills the PF penalty as an adjustment to the demand charge rather than a separate line item. Look for "Power Factor Adjustment" or check if the demand multiplier seems higher than it should be. At 0.82 PF they should definitely be getting hit.