How does a Capacitor improve Power Factor in AC Systems?

How does a Capacitor improve Power Factor in AC Systems?

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Capacitors improve Power Factor in AC systems by supplying leading reactive power that offsets the lagging reactive power consumed by inductive loads such as

This reduces the reactive current drawn from the power source, decreases overall current flow, minimizes power losses, improves voltage regulation and increases system efficiency.

By bringing the current waveform closer in phase with the voltage waveform, capacitors help raise the Power Factor toward unity resulting in better utilization of electrical equipment capacity and reduced demand charges in industrial power systems.